Reviving Zakah Institution to Alleviate Poverty in OIC Countries

Reviving Zakah Institution to Alleviate Poverty in OIC Countries
Rahma Suci Sentia

In the past three decades, the poverty rate have decreased dramatically (World Bank, 2014). Unfortunately, there is no significance change in the rate of OIC countries.  In this short essay, the current situation in OIC/muslim countries will be discussed as well as strategies to eradicate poverty and enhance muslim Societies through institution of zakah.

In the early 20115, SESRIC released report which stated that total of 465 million people OIC (Organization of Islamic Coorporation) member countries (35% of their total population) are considered as multidimensional poor, accounting for 29% of the world total multidimensional poor in 2014. The report also outlined four main challenges to OIC countries: basic services, availability of financial resources, institutional capacity and political will^[1]. Based on multidimensional analysis show if this situation is not ended it up, the total of poverty in the world will be rooted from OIC countries.

Theoretically, those problems could be solved by the implementation of institution of zakah. It will provide financial assistance to the poor community without any collateral and interest which in the end will eliminate interest from the society. Since, the institution of zakah has not really implemented in OIC comprehensively yet, the challenge in are mainly come from how to realize it. The challenge as well as strategies that are needed will be discussed below.

Firstly, OIC Countries need to further reviving the role of compulsory institutions and activate the eight roles of zakah (mustahiq) within Muslim society. The existing zakat institution today just focused to distribute zakat to several categories because of lack of zakat fund whereas actually OIC still has huge potential in collecting zakat, estimated to be 5.20 percent of the GDP of OIC. A sophisticated research, plan, model also had been proposed and showed in several conference. What OIC needs now is a quick action from the government.

Secondly, its administration must be centralized and its collection must be made compulsory upon all eligible Muslim, only then its huge amount will be realized. Currently, only Sudan that had the zakat compulsory system, and Maldives that will propose in 2015 to have this such system. Most of zakat institution have been effectively impacted yet because of the granular voluntary institution which is small and many. It will lead to ‘too many to fail” because the distribution program overlaps and do not achieve the end goal.

Thirdly, the collecting of zakat from monthly salary have to be implemented. There are many rooms for improvements OIC zakah collection from salary. Zakah salary regulation is still not common in OIC countries therefore only few people of OIC work force properly paid their zakah.   This shows that there is huge potential in OIC zakah management which needs to be solved quickly.

Lastly, OIC should creatively distribute zakah to all mustahiq citizens. Many problems around the world are caused by lack capacity in distributing. This is reflected in Sudan zakat policy or zakat programs in almost all mosques of OIC. If this problem can be overcome, not only basic need will be fulfilled, a more need OIC will also be achieved. Therefore, OIC governments need to still work together with successful existing voluntary institution e.g Dompet Dhuafa (http://www.dompetdhuafa.org/). The purpose is to take advantage from their link and strength in distributing zakat which closely interlinked with other socioeconomic sectors such production, literacy, health care facilities, possession of assets, job opportunities, and rural infrastructural facilities. Unless the improvement of these indicators is considered properly in distributing, income may not be increased to a substantial level.

To conclude, the writer argues that the current poverty level in OIC countries will remained stable, even may increase dramatically if there is no remarkable policy. Thus concern should be directed upon providing the accessible financial resource institution which could fulfil the domestic basic need and is driven by the government of each OIC countries, through reviving institution of zakat. However, governments should be more creative in collecting zakat (e.g. imposing zakat from month salary) and do partnership with the voluntary institution that has got successful in distributing zakat. (Sentia)

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[1] Measurement of Poverty in OIC Countries, 2015, page 6