Integration of Zakat and Awaqf for Poverty Alleviation and Development

Abstract

This paper recommends that maintaining overall microfinance industry’s nature and character of poverty alleviation approach, an Islamic microfinance approach has to be developed integrating Islamic Shariah-approved charity sources of fund like zakat, sadaqah, and awaqf and Shariah-compliant tools like Mudarabah, Musharakah, Bai-Muajjal, etc., toward ensuring socio-economic development of the poor as well as sustainability of the organizations involved for maintaining continuity of the services for years and ages together. In this connection, this research further found that Center for Zakat Management (CZM) has been working mainly with zakat at larger volume and also awaqf funds toward socio-economic development of the poor and extremely poor for last nine years. By this time, the organization gained formidable experience and developed a model zakat-based poverty alleviation approach. The successes they achieved and the challenges they faced as an organization working with zakat and awaqf funds can provide an important message for all who favor integration of zakat and awaqf as an effort toward playing effective role in socio-economic development of the poor and extremely poor in Bangladesh and elsewhere in the world.