Abstract
This paper aims to discuss the use of financial technology in waqf (Islamic endowment) for funding religious and social causes. It is believed that waqfintech could reach a wider audience and benefit more people in need through the use of innovative financial technology like crowdfunding and blockchain. The main objective of this paper is to introduce the concept of waqfcrowd and waqfcoin as a means of collecting and managing waqf in the digital age. Waqf institutions can thus take advantage of technological innovation to utilise the convenience and efficiency offered by financial technology. This is a conceptual paper which reviews the relevant literature regarding waqf and financial technology. One major limitation of this paper is that it does not discuss the regulatory and operational details of how to institutionalise blockchain technology in different regions. This paper intends to inspire Islamic financial institutions and waqf institutions to harness the potential of waqfintech to raise funds in an effective way.
Highlights
Waqf refers to charitable endowments in Islam, which typically involve donating a plot of land, a building, or other assets for religious or charitable purposes
Direct Cash Waqf Model Direct cash waqf refers to endowments made by donors in the form of monetary value to be channelled directly to develop waqf property (Mohsin, 2014)
The creative uses of financial technology in waqf are manifold. Innovative technologies such as blockchain and crowdfunding are all good reasons to be optimistic about the future of waqf and its vital role in socio-economic development
Summary
Waqf refers to charitable endowments in Islam, which typically involve donating a plot of land, a building, or other assets for religious or charitable purposes. The Islamic ideology of a two-world framework of life leads to participation in social causes and selfless behaviour in charitable giving (Shaikh et al, 2017). The basis of this spiritual aspect lies in the following Quranic verse: By no means shall ye attain righteousness unless ye give (freely) of that which ye love; and whatever ye give, of a truth God knoweth it well (Surah Al-i-Imran 3:92). In the United Arab Emirates, the General Authority of Islamic Affairs and Endowments (www.awqaf.gov.ae) use waqf funds to assist orphans and poor people; build and equip clinics; sponsor social and humanitarian services; provide the necessities of travel for pilgrims; sponsor scholars and provide water sanitation and distribution. It should be highlighted that waqf should not be associated with alcohol dealings, pornographic dissemination, gambling, sale of pork and other impermissible causes under Shariah law (Ambrose et al, 2018)
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