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A message from London: Pay your “zakat” locally

October 2, 2018 • FINANCE & BANKING, Responsible Finance

By Greget Kalla Buana

Zakat (Islamic alms giving) is now consi-dered as an alternative resource to help achieve the SDGs. London, the capital of a developed Muslim-minority country, has a unique approach to encouraging Muslims to pay zakat, resulting in a significant amount of almost the same with that in Indonesia, the world’s most populous Muslim-majority country.

 

In the last few weeks before Ramadan, an advert from the National Zakat Foundations urging Muslims to pay their zakat locally in the UK was posted at the Hainault Street bus stop. This particular campaign caught the attention of and earned praise from UK Muslims. In 2016, number of UK Muslims surpassed three million of which one-third resides in London. More specifically, data from the 2011 census stated that one out of eight Londoners is Muslim making the city a home to large Muslim community.

Such phenomenon has portrayed UK Muslims’ undeniable power to play a major role in helping the society through a religious charitable fund called zakat. Zakat is a mandatory giving paid by eligible Muslim earning above certain threshold, which, when it has reached a specified amount, is commanded to be given to the deserving people (eight group of beneficiaries according to Quran). This social part of Islamic finance has an enormous potential and been considered as an alternative resource to help achieving the Sustainable Development Goals (SDGs).

An end to poverty and inequality is the biggest challenge now to be addressed through the SDGs. Given the principles of Islam in favour of socially inclusive development, funding from Islamic finance, such as zakat, has the chance to play an important role. Zakat and the SDGs overlap in terms of compatibility and embeddedness with the five foundational goals of Islam (Maqasid al Shariah).

 
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About the Author

Greget Kalla Buana is an Islamic Finance Specialist at the United Nations Development Programme and graduated from Master of Islamic Finance and Management, Durham University, UK. His work experiences have always been in Islamic finance sector, such as Dompet Dhuafa (Indonesia Humanitarian NGO which is also a consultative member of ECOSOC, using Islamic finance instruments as fund resources), Islamic Banking Department of Indonesia Financial Services Authority, and UNDP where they established partnership with Islamic Research and Training Institute of Islamic Development Bank. 

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