AN ANALYSIS OF WAQF, ZAKĀT, QARḌ AND TAKĀFUL AS ISLAMIC SOCIAL FINANCE INSTRUMENTS: JURISTIC VIEWS

Abstract

This paper discusses how waqf properties, zakāt and qarḍ which are Islamic social finance (ISF) instruments, can be used to assist different categories of low-income individuals and groups to achieve financial empowerment and widen their financial well-being. In addition, this paper explains how takāful products and services can prevent financial anxiety and strengthen the financial resilience of low-income individuals and groups against unpredictable shocks. Qualitative approach is used to review opinions of both classical and contemporary jurists from four major Sunni madhāhib namely, the Ḥanafiyyah school, the Mālikiyyah school, the Shāfiʽīyah school and Ḥanbaliyyah school on the useability and application of waqf, zakāt, qarḍ and takāful as social financing tools. In addition, the paper discusses ijtihād held by a number of Muslim jurists who are known for deep thought and their ability to scrutinise and compare opinions and views from different Shari’ah sources. As the result, the divergent views expressed by these jurists are to some extent reconciled to help the policymakers and other interested parties to have a clear understanding of the actual meaning of the concept of sufficiency of sustenance/need (ḥājah) and conditions that deem to appropriately align with the concept. This is expected to provide the basis for the policymakers to formulate policies and strategies for the intended beneficiaries who are the low-income individuals and groups who constitute the vulnerable groups in a society. 
 This research is supported by Ministry of Education (MOE) through Fundamental Research Grant Scheme (FRGS /1 /2021 /SS01 /UIAM /03 /3).