The Maqasid Al Shariah and the Sustainability Paradigm: Literature Review and Proposed Mutual Framework for Asnaf Development

Purpose - The study examines through analysing the literature, that the zakat recipients (asnaf) can be better entertained by a sustained mechanism than one-off measures. The main aim towards asnaf upliftment should be based on a self-reliance goal-oriented-action strategy plan to alleviate them from any further deprivation. The aim of Maqasid in addressing these issues is to ensure that an asking basket gets smaller day by day through an effective regime. Design/Methodology/Approach - The paper analyses and synthesises the relevant literature on Maqasid and sustainable paradigm, then proposes a conceptual convergence to understand the paradigmatic similarities between the two in appreciating the welfare of zakat recipients. Findings - The paper attempts to examine the latitude of sustainability and Maqasid necessities in relation to asnaf welfare. The sustainability development’s main concern that the future generation benefits from the present development, which is quite similar to Hifzul Nasl or protection of progeny in Maqasid fulfilment. It can be stated that the three jurisdictions of sustainable development (SD) paradigm i.e., namely, the social, economic and environmental concerns are in actual fact, more in conformity with the Maqasid requirements. But many authors stated that indeed Maqasid is more wholesome and more encompassing than the traditional SD paradigm. Islam categorically highlights that human being as a caretaker of environment, need to ensure a better, and harmonious society, that should be erected with constructive and productive economic activities and not resorting to any damages to the nature. These concerns clearly conforms with Maqasid when it conditions that the protection of life or health, or intellect or progeny or wealth needs to be with true understanding about the self as well as the kindness of the creator, which truly encompasses faith, and that to achieve any higher dimension, may require that these basic necessities are fulfilled and ascertained at the foremost. Originality/value - This study scrutinises a comprehensive understanding about sustainability and Maqaisd needs in addressing the asnaf development and welfare. The study further elucidates that even the nature is in constant salutation towards thanking the Lord for all the bounties

Investigating factors affecting the intention to use Islamic personal financing

The purpose of this paper was to examine the main factors that influence consumers’ intention to use Islamic personal financing.A sample of 308 employees from Universiti Utara Malaysia was surveyed.Attitude, social influence, perceived behavioral control, religious obligation and religiosity were examined towards the intention to use Islamic personal financing.The results show that perceived behavioral control proved to be a strong predictor.The findings of this study provide key inputs to an Islamic bank for better planning of Islamic personal financing facilities

Effective Zakat Distribution: Highlighting Few Issues and Gaps in Kedah, Malaysia

The aim of this paper is to identify what are the impediments in implementing an effective Zakah distribution in Kedah, Malaysia. Auspiciously, post-colonial Malaysia is experiencing robustness in terms of Zakah collections, as the statistics are currently signifying, but at the same breath the degree of effectiveness in Zakah distribution has not been providentially catching that optimistic evolution. And even if, the Zakah is duly distributed, the point to note is that the effectivity of that distribution has indubitably remained in question. So this gap is an issue that has been observed by the givers, and if the collection is to increase further, the issue of effectivity in Zakah distribution needs to show a healthier trend to convince these worried payers. The implications of resolving the issues discussed below may assist to enhance this sector, if timely addressed and taken applicable measures for remediation. DOI: 10.15408/aiq.v9i2.400

Promoting housing affordability in Malaysia: can Islamic finance play a role?

This study seeks to investigate the relationship between affordability of home ownership in Malaysia and the role played by Islamic banks in promoting affordable financing.By establishing the link between affordability (measured by median house price/gross domestic product per capita) and total home financing by Islamic banks, the study seeks to decipher the issues of home ownership affordability.At the same time, it attempts to shed some light on the role of Islamic finance in providing a syariah based and syariah compliant alternative of a fair-priced home loan in promoting home ownership affordability in Malaysia. The study employs auto regressive distributed lag model on quarterly data from 2007 until 2014 to investigate the link between affordability and selected banking variables such as total home financing by Islamic banks and overnight policy rate.Data were extracted from the NationalV Property Information Centre and Bank Negara Malaysia Monthly Statistical Bulletin.Our findings suggest that Islamic banking plays a bigger role in promoting affordability by offering a fair and sustainable financing. The study highlights that Islamic banking to a certain extent has managed to live up to its ideals in achieving the maqasid al-shariah

Analysing The Loopholes on Estate Administration of Cryptocurrency in Malaysia: Shariah and Law Perspectives

The recognition of cryptocurrency as digital assets in Malaysia under the purview of security governed by the Securities Commission of Malaysia contributed to cryptocurrency's positive acceptance, with evidence that the number of cryptocurrency users is growing. Nonetheless, due to the unique characteristics of cryptocurrency, the lack of legal regulation on cryptocurrency inheritance will have an impact on crypto estate administration. Apparently, the law on cryptocurrency in Malaysia is still in its infancy, and the existing issue of frozen estate in Malaysia, which is constantly increasing, prompted the researchers to investigate potential loopholes in cryptocurrency estate administration from a legal and shariah standpoint. The study conducts content analysis by examining the relevant statutories, such as “the Probate and Administration Act 1959, the Capital Market Service Act 1997, the Capital Market and Services (Prescription of Securities) (Digital Currency and Digital Token) Order 2019, Shariah Resolutions and Fatwas in Malaysia”, other literatures related to cryptocurrency estate administration. As a result, there are legal loopholes in cryptocurrency estate administration in Malaysia that prevent cryptocurrency from being inherited by the entitled beneficiary. The issue of cryptocurrency inheritance may arise in the near future; thus, this study provides policy implications to the Malaysian regulators to solve the highlighted lacuna as well as social implications to the Malaysian society to consider cryptocurrency in their inheritance planning

Examining the relationship between risks and efficiency of Islamic banks in Malaysia

This paper aims to examine the efficiency level of Islamic banks in Malaysia and their relation to credit risk, liquidity risk and operational risk. Twelve Islamic banks were chosen as samples for this study which were taken by the availability of data, through each banks’ annual report from 2008 to 2013. This study was carried by applying the Data Envelopment Analysis (DEA) and Multiple Regression Analysis to achieve its objectives. The finding shows that Islamic banks in Malaysia exhibited a total of 77.1% of overall efficiency of technical (OTE), 83.1% of Pure Technical Efficiency (PTE) and 92.6% of Scale Efficiency (SE). Despite the global financial crisis that occured during the middle year of 2007 to the end of 2009 which slightly affected Asian countries such as Malaysia, nevertheless, Islamic banks seem to be more robust during the crisis than conventional banks. This is because of its basic nature which prohibited interest payments (riba) in all transactions. This study shows that credit risk has a negative significant relationship with efficiency of Islamic banks, while liquidity was found to be positive related to efficiency of Islamic banks. This study also found that the size of the bank has positive significant relationship to efficiency. Finding from this study give contribution to the policy makers and regulators as well as to the managers of Islamic banks by providing empirical evidence on the performance of the Islamic banks in Malaysia towards the efficiency level and risks relationship

Gelagat kepatuhan pembayaran zakat pendapatan : Kajian kes UUM

Berdasarkan kepada asas zakat dikenakan ke atas harta yang berkembang, maka berlaku perluasan kewajipan ruang berzakat kepada harta-harta berkembang yang lain selain daripada lima jenis harta yang diamalkan oleh Rasulullah saw. Rentetan dari itu kebanyakan negeri telah mewartakan zakat pendapatan sebagai zakat yang wajib dikeluarkan oleh individu Islam. Lebih menarik lagi, bukan sahaja jumlah kutipan bagi negeri malahan jumlah kutipan zakat pendapatan di daerah-daerah kecil juga mencatatkan peningkatan. Sebagai contoh, kutipan zakat pendapatan di daerah Kubang Pasu telah meningkat dari RM35,450.41 pada tahun 1990 kepada RM1,760,925.40 pada tahun 2003 iaitu berlaku peningkatan sebanyak 48.67 kali ganda berbanding tahun 1990. Daripada jumlah tersebut, sebanyak RM918,478 merupakan kutipan zakat pendapatan daripada kakitangan UUM melalui skim potongan gaji. Namun sehingga April 2004 peratus kakitangan UUM yang membayar zakat pendapatan melalui skim potongan gaji hanyalah sekitar 28.57 peratus sahaja. Adakah selebihnya tidak mengeluarkan zakat pendapatan? Atau mungkinkah mereka menyalurkan zakat tersebut terus kepada asnaf tertentu? Bertitik tolak dari persoalan ini, maka adalah suatu yang menarik untuk mengkaji gelagat individu (kakitangan UUM) mengeluarkan zakat pendapatan. Dengan menggunakan teknik penganggaran maximum likelihood dalam pengujian hipotesis berarah, beberapa pembolehubah bebas telah dikenalpasti sebagai faktor yang signifkan mempengaruhi gelagat individu mengeluarkan zakat

What influence Muslims to make wills?: insights into its determinants

The aim of this study is to investigate factors that influence the practice of making will among Muslims in Malaysia. In Malaysia, it can be noted that some progress towards enhancing Islamic estate planning has taken place, particularly in the practice of Islamic will. Islamic estate planning industry in Malaysia has grown and now offers a variety kind of products to facilitate Malaysian Muslims to manage and improve their estate planning matters. Nevertheless, the value of unclaimed and frozen assets in this country keeps growing annually. Hence, this study aims to look at the practice of making wills in Malaysia and investigate factors that influence Muslims to do it. Using a quantitative analysis, a total of 338 questionnaires were used to achieve the objective. The method of analysis employed in this study include Independent Sample T-Test, One-Way Analysis of Variance (ANOVA), Pearson and Correlation as well as Multiple Regression. The results of this study indicate that there is a significant difference between gender (male and female), educational levels and monthly income levels towards Islamic will practice. Nevertheless, only ethnicity showed no significant difference towards Islamic will practice. The correlation analysis showed a significant and positive correlation between knowledge, wealth management,institutional factor and religiosity toward Islamic will practice. The results show that knowledge and wealth management are the main variables that influence Muslims towards Islamic will practice. This explains that higher level of knowledge and wealth management among Muslims will lead to a higher practice of Islamic will. These results suggest that the government and Islamic estate planning industry should put a greater emphasis on attracting and educate Muslims to manage and plan their wealth well during their lifetime

Understanding Asnaf’s Sustainability through Effective Distributive Performance: A Conceptual Assessment

Zakat is receiving due position in Islamic welfare management studies for the last few years as the global situation in terms of unpredictability is on the rise.Interestingly and positively, both collection and distribution of zakat is increasing year after year yet still something is missing. The effectiveness of distribution of Zakat in terms of timely delivery or quality options of asnaf sustainability is still a big question. The issue of effective delivery requires a performance measurement, which may invite the zakat organisations to look into the possibility of incorporating a scorecard approach in evaluating the achievements thus far.This study attempts to look into asnaf sustainability as a measuring tool and an evaluation criterion for understanding the zakat’s institutional performance while keeping the demographic profile as a balancing option in assessing the relationship. The study is in elementary stage for which data analysis and further recommendation is still forthcoming.It will thus highlight the issues related to autonomous zakat body versus non-autonomous zakat bodies’ priority and problem resolving tactics in addressing the asnaf’s sustainability.The study put forward a conceptual assessment comprising of potential evaluating criterion variables for assessing asnaf sustainability and their relationship with performance of zakat distribution system. The outcomes of the study will enable theorists and policy makers in Islamic societies as well as in Islamic countries to devise effective approaches towards a promising zakat distribution system and thereby achieve the objectives of welfare

Efficiency of Islamic banks during the financial crisis: An analysis of Middle Eastern and Asian countries

The world economy is still suffering from the severe global financial crisis that caused the failure of several banks.This has encouraged economists worldwide to consider alternative financial solutions and attention has been focused on Islamic banking and finance as an alternative model.Hence, this study examines the efficiency level of Islamic banks during the financial crisis specifically in Middle Eastern and Asian countries from 2007 to 2010.Moreover, bank-specific and risk factors were examined to understand the determinants of efficiency. The efficiency of Islamic banks is measured using data envelopment analysis by adopting the intermediation approach.The financial information is extracted from BankScope database for a four year period (2007–2010) which includes 79 Islamic banks across a number of countries.The study also critically analyses pure technical efficiency and scale efficiency of the Islamic banks in Middle Eastern and Asian countries and estimates their return to scale.The findings explain that Islamic banks were able to sustain operations through the crisis.However, the study also shows the majority of these Islamic banks were scale inefficient. Most of the scale inefficient banks were operating at decreasing returns to scale.This study also found that both profitability and capitalisation were the main determinants of Islamic banking efficiency.Hence, the findings of this study have policy implications and make a contribution to policy-making by providing empirical evidence on the performance of the Islamic banks and their efficiency levels