The development of national waqf index in Indonesia: A fuzzy AHP approach

Abstract

As one of the alternative forms of Islamic Social Finance, Waqf could be potentially developed to achieve the Sustainable Development Goals in Indonesia, particularly providing a major solution for socio-economic problems, such as poverty, improving education quality, and giving a lifelong learning opportunity, unemployment, and many more. But, unfortunately, due to the absence of a universal standard of Waqf evaluation, the implementation of Waqf in Indonesia has not been optimal. Therefore, this study proposes the National Waqf Index (Indeks Wakaf Nasional or IWN) for improving the governance system and measuring waqf performance at national and regional levels. Through literature review and focus group discussion (FGD), this study develops six factors, namely regulatory (with three sub-factors), institution (with two sub-factors), process (with four sub-factors), system (with three sub-factors), outcome (with two sub-factors), and impact (with four sub-factors). Using the Fuzzy Analytical Hierarchy Process (Fuzzy AHP) involving experts from government, academic, and industry, this study finds that the priority of IWN is a regulatory factor (0.282) followed by institution factor (0.251), process factor (0.190), system factor (0.156), outcome factor (0.069), and impact factor (0.050). The findings from this study will strengthen the existing literature in Waqf and be used to develop the governance system to improve performance.