Integration of Islamic Philanthropic Economic Services for Alleviation of Poverity: the Case of Affordable Housing

Sadr, Seyed Kazem; Alhabshi, Syed Othman; Abdel Mosin, Magda Ismail; Abdul Razak, Shaikh  Hamzah

doi:10.29252/jep.1.2.55

Integration of Islamic Philanthropic Economic Services for Alleviation of Poverity: the Case of Affordable Housing

Document Type : Original Article

Authors

¹ Faculty of Economics and Political Sciences, Shahid Beheshti University, Tehran, Iran

² International Centre for Education in Islamic Finance, Malaysia

10.29252/jep.1.2.55

Abstract

This paper argues that the goal of poverty alleviation and a decent standard of living is not attainable in Muslim communities unless the economic and social services of the Islamic philanthropic institutes are integrated and a full-fledged collaboration would be resumed among the managing boards. The first part of the paper will examine why Muslims participate in altruistic giving and what are the alternative forms of contributions that are provided by Shariah of Islam. The second part will review the potential and actual contributions of the said Islamic benevolent giving for poverty eradication and well-being of low and vulnerable income families. The third and concluding part will discuss the conditions, methods and mechanism for integration and coordination among Islamic philanthropic institutes for provision of affordable housing.

Keywords

20.1001.1.27171485.2020.1.2.4.9

References

Ahmed, H. (2007). Waqf-Based Microfinance: Realizing the Social Role of Islamic Finance. Jeddah: Islamic Research and Training Institute, Islamic Development Bank.
Ahmad, S., Wahid, H. and Mohamad, A. (2006). “Penswastaan Institusi Zakat dan Kesannya
Terhadap Pembayaran Secara Formal di Malaysia” (“Privatisation of zakat institutions in Malaysia and its effect on formal payment”), International Journal of Management Studies, Vol. 13 No. 2, pp. 175-96.
Arab Mazar, Abbas (2007). “The Organizational Structure of QH Funds in Iran”, SESRTCIC Workshop, Turkey, Istanbul.
Alpay, S & Haneef M.A. (Ed.) (2015). Integration of Waqf and Islamic Microfinance for Poverty Reduction: Case Studies of Malaysia, Indonesia and Bangladesh, SESRIC & IIUM publication.
Armendariz, Beatriz and Jonathan Morduch, (2010). The Economics of Microfinance, the MIT Press, Cambridge, Ma. U.S.A.
Bakar, N.B.A. and Rahman, A.R.A. (2007). “A comparative study of zakah and modern taxation”, J.KAU: Islamic Economics, Vol. 20 No. 1, pp. 25-40.
Besley, Timothy J., Stephen Coate, and Glenn Loury (1994) ‘Rotating savings and credit associations, credit markets and efficiency.’ Review of Economic Studies 61, 701–719
Besley, T., S. Coate, and G. Loury (1993). ‘The economic of rotating savings and credit associations.’ American Economic Review 83(4), 792–810.
Bouman, F. (1977). ‘Indigenous savings and credit societies in the third word: A message.’ Saving and Development 1(4), 181–218.
Bouman, F. (1995). ‘Rotating and accumulating savings and credit associations: A development perspective.’ World Development 23(3), 371–384.
Buang, A.H. (2000). “Pengurusan Zakat: Satu Analisis dari Perspektif al-Quran dan al- Sunnah” (“Management of zakat: an analysis from the perspective of Al-Quran and As-Sunnah”),Jurnal Syariah, Vol. 8 No. 2, pp. 89-102.
Cizakca, Murat (2000), A History of philanthropic Foundations, Bogazici University Press, Istanbul.
Cizakca, M. (2004). "Cash Waqf as Alternative to NBFIs Bank". Paper presented in the International Seminar on Nonbanking Financial Institutions: Islamic Alternatives; March, 1-3; 2004, Kuala Lumpur Malaysia.
Cizakca, Murat (1979). “Cash Waqfs of Bursa 1555-1823”, JESHO, vol. 38, pp.314-354 (1995.) See also Jon E. Mandaville, “Usurious Piety, the Cash Waqf Controversy in the Ottoman Empire”, International Journal Middle East Studies, vol. 10, 289-308.
El-Gari, M.A. (2004). "The Qard Hasan Bank. "Paper presented in the International Seminar on Nonbanking Financial Financial Institutions: Islamic Alternatives; March, 1-3; 2004, Kuala Lumpur Malaysia.
El-Karanshawy, H. A. (2015). Foreword. In H. A. El-Karanshawy et al. (Eds.), Access to finance and human development — Essays on Zakat, Awqaf and microfinance. Doha, Qatar: Bloomsbury Qatar Foundation.
Gaji” (“The role of behaviour on compliance behaviour of zakat on employment income”), ANALISIS, Vol. 9 Nos 1/2, pp. 171-91.
Haneef, Mohamed, et al. (2013). “ Integration of Waqf and Islamic Microfinance for Poverty Reduction: A Survey in Kuala Selangor Malaysia”, Journal of Islamic Finance, Vol.2, No.2.
Haneef, M. A., Pramanik, A.H., Mohammed, M.O., Dahiru, A. & Amin F.B. (2013). “Integration of Waqf and Islamic Microfinance for Poverty Reduction: A Survey in Kuala Selangor Malaysia”, Journal of Islamic Finance, Vol.2, No.2.
Hasnol Ak Md, Alwee Pg, Salleh Md (2015). Financial exclusion and saving motives in Brunei: A need to re-define zakat & awqaf In H A El-Karanshawy et al. (Eds.), Access to finance and human development – Essays on Zakat, awqaf and microfinance. Doha, Qatar: Bloomsbury Qatar Foundation.
Hassan, M. K. (2010). “An Integrated Poverty Alleviation Model Combining Zakat, Awqaf And Micro-Finance”, Proceedings Of 7th International Conference , The Tawhidi Epistemology: Zakat and Waqf Economy , Institut Islam Hadhari, Universiti Kebangsaan Malaysia, 6 – 7 January, 2010.
, K. M. (2015), “Integrating Zakat, Awqaf and IMF for Poverty Alleviation: Three Models of Islamic Micro Finance”, Journal of Economic and Social Thought, Vol.2, Issue 3, September 2015.
Idris, K.M. and Ayob, A.M. (2002), “Peranan Sikap dalam Gelagat Kepatuhan Zakat Pendapatan
Idris, K.M., Ali, E.I.E. and Ali, J. (2003). “The role of intrinsic motivational factors on compliance behaviour of zakat on employment income”, Jurnal Pembangunan Sosial, Vol. 6/7, pp. 95-122.
Iran Statistical Center (2001 & 2006), Survey of Gharzul-hasaneh Funds, Tehran.
Iqbal Z. & Roy F. (2015). A market-based financing model for Islamic housing microfinance market. In H.A. El-Karanshawy et al. (Eds.), Access to finance and human development – Essays on Zakat, awqaf and microfinance. Doha, Qatar: Bloomsbury Qatar Foundation
Islamic Relief UK (2016), What is the Nisab & Hawl?, Retrieved from: http://www.islamic-relief.org.uk/about-us/what-we-do/zakat/zakat-faqs/
Khaf, M. (n.d.), Role of Zakat and Awqaf in Reducing Poverty: A Proposed Institutional Setting within the Spirit of Shari’ah. Thoughts on Economics, 18(3), pp. 58-59.
Kahf, M. (2004). “Shariah and Historical Aspects of Zakat and Waqaf.” Paper presented for Islamic Research and Training institute, Islamic Development Bank.
Kahf, Monzer, (2000) Al-Waqf Al-Islami: Tatawwuruh, Idaratuh, Tanmiyatuh (Beirut: Dar al-Fikr,), hereafter cited as Al-Waqf Al-Islami.
Khalifa, Mohamed Ali, (2014), Integrating Zakat, Awqaf and Islamic Microfinance for Poverty Alleviation: Three Models Of Islamic Micro Finance, IRTI Working Paper Series, WP# 1435-19, IRTI.
Khan, M. F. (n.d.), Integrating Faith-based Institutions (Zakat and Awqaf) in Poverty Reductions Strategies (PRS), IDB, IRTI.
Madiha Khan and Geoff Lightfoot, ROSCAs: Alternative Funding for Sustainable Enterprise
Islamic Relief UK (2016), What is the Nisab & Hawl?, Retrieved from: http://www.islamic-relief.org.uk/about-us/what-we-do/zakat/zakat-faqs/
Levenson, Alec and Timothy Besley, (1996). “The anatomy of an informal financial market: Rosca participation in Taiwan”. Journal of Development Economics 51: 45-68.
Leeuwen, Richard Van (1999). Waqfs and Urban Structures: The Case of Ottoman Damascus ,Leiden: Boston Press.
Mahmud K T, Hassan M K, Sohag K, Alam Md F (2015). Impact of zakat in alleviating rural poverty: A case study of Masjid Council for Community Advancement (MACCA) in Bangladesh. In H A El-Karanshawy et al. (Eds.), Access to finance and human development – Essays on Zakat, awqaf and microfinance. Doha, Qatar: Bloomsbury Qatar Foundation
Mirakhor, A. and Iqbal, Z (2007). Qard Hasan Microfinance. New Horizon. No. 164, April-June.
Muhammad, A. (2008), “Perception of academicians towards zakat administration particularly zakat distribution: the case of Selangor and Kelantan”, unpublished Master thesis, International Islamic University Malaysia, Kuala Lumpur.
Al-Mohsin, Magda, et.al. (2016). Financing the development of Old Waqf Properties,Kuala Lumpur, Palgrave –Macmillan.
Al-Mohsin, Magda Ismail (2013). Potential of zakah in eliminating riba and eradication poverty in Muslim countries. Islamic Management and Business, EJBM-Special Issue. Vol. 5 No. 11, p 115.
Najeeb, S. and Lahsana, A. (2013). Qard Hasan: Its Shari’ah Rules and Applications in Islamic Finance. Journal of Islamic Business and M Vol. 3, No. 1.
Nor, M.A.M., Wahid, H. and Nor, N.G.M. (2004). “Kesedaran Membayar Zakat Pendapatan di Kalangan Kakitangan Profesional Universiti Kebangsaan Malaysia” (The awareness of paying zakat on income among professional staff of National University of Malaysia), Islamiyyat, Vol. 26 No. 2, pp. 59-67.
Obeidullah, Mohammad (2008). “Introduction,” in Islamic Finance for Micro and Medium Enterprises, ed. By Obaidullah and Hajah Salma Haji Abdul Latif, IRTI,IDB, and centre for Islamic banking, Finance and Management, Universiti Brunei Darussalam.
Rahman, A.R.A. (2007), “Pre-requisites for effective integration of zakah into mainstream Islamic ﬁnancial system in Malaysia”, Islamic Economic Studies, Vol. 14 Nos 1/2, 91 107.
Rutherford, Stuart. (1997). “Informal financial services in Dhaka’s slums”. In
Geoffery Wood and Iffath Sharif, eds. “Who needs credit? Poverty and Finance in Bangladesh. Dhaka: University Press Ltd.
Al-Qaradawi, Y. (2011). Fiqh Al-Zakāh: A Comprehensive Study of Zakat Regulations and Philosophy in the Light of the Qurʼan and Sunna. (M. Kahf, ). The Other Press.
Sadr, S.K. (2016) The Economic System of the Early Islamic State: Institutions and Policies, approved for publication by the Palgrave –Macmillan Com.
Sadr, S.K. & Torabi, O. (2015). “Qard Hasan and Microfinance” in State of Islamic Finance: A Retrospective Assessment and Looking Forward eds: Zamir Iqbal and Zurina Shafi
Sadr, Seyed Kazem, Syed Othman Alhabshi and Timur Rustemov (2014). A Comparative Study of Islamic Microfinance Institutions in Iran, Pakistan, Bangladesh, Indonesia and Malaysia", Research Project: RWC 16:04/2013/007, INCEIF, Kuala Lumpur, June.
Shehata, S.I. (1994). “Limitations on the use of zakah funds in ﬁnancing socio-economic infrastructure”, Islamic Economic Studies, Vol. 1 No. 2, pp. 63-78.
Shirazi, N. S. (2014). Integrating Zakāt and Waqf into the Poverty Reduction Strategy of the IDB Member Countries, Islamic Economic Studies, 22, No. 1, May, 2014 (79-108).
Shirazi, Nasim Shah (2014), Integrating Zakāt and Waqf into the Poverty Reduction Strategy of the IDB Member Countries, Islamic Economic Studies, 22, No. 1, May, 2014 (79-108).
Tobin, J. (1958). Liquidity Preference as Behavior Towards Risk. Review of Economic Studies, No.67 February.
Wahid, H., Ahmad, S. and Nor, M.A.M. (2004). “Kesan Bantuan Zakat Terhadap Kualiti Hidup: Kajian Kes Asnaf Fakir dan Miskin” (“The effect of zakat aid on the quality of life: the case of the poor and needy recipients”), The Journal of Muamalat & Islamic Finance Research, Vol. 1 No. 1, pp. 151-66.
Wahid, H., Nor, M.A.M. and Ahmad, S. (2005), “Kesedaran Membayar Zakat: Apakah Faktor Penentunya?” (Awareness to pay zakat: what are the contributing factors?), International Journal of Management Studies, Vol. 12 No. 2, pp. 171-89.
Wahid, H., Ahmad, S. and Kader, A.R. (2008). “Pengagihan Zakat oleh Institusi Zakat di
Malaysia: Mengapa Masyarakat Islam Tidak Berpuashati (2008). (“Distribution of zakat in Malaysia: why are the Muslims still dissatisﬁed”), Proceedings of Seminar Kebangsaan Ekonomi Malaysia, Universiti Kebangsaan Malaysia, Bangi.
Wahid, H., Ahmad, S. and Kader, A.R. (2009), “Pengagihan Zakat oleh Institusi Zakat kepada Lapan Asnaf: Kajian di Malaysia” (“Distribution of zakat to the eight asnaf: Malaysian case”), Proceedings of Seminar Kebangsaan Ekonomi Islam 2008/09, Akademi Pengajian Islam, Universiti Malaya, Kuala Lumpur
Yumna, A. & Clark, M. (2012). “Integrating Zakat and Islamic charities with microfinance initiative in the purpose of poverty alleviation in Indonesia”, 8^th International Conference on Islamic Economics and Finance, Center for Islamic Economics and Finance, Qatar faculty of Islamic Studies, Qatar Foundation.
Yuma, Aimatul & Clark, Mathew (no date), “Integrating Zakat and Islamic charities with microfinance initiative in the purpose of poverty alleviation in Indonesia”, 8^th International Conference on Islamic Economics and Finance, Center for Islamic Economics and Finance, Qatar faculty of Islamic Studies, Qatar Foundation.
Zada, N. and Saba, I. (2013). The Potential Use of Qard Hasan in Islamic Microfinance. ISRA International Journal of Islamic Finance. Vol. 5, Issue 2, December.