An Analysis on the Impact of Zakah Programs In Poverty Alleviation: Case Study in Bandung, Indonesia

Proceedings of the Zakat International Conference 2011, Bogor: World Zakat Forum, Bogor Agricultural Institute (IPB) and Ibnu Khaldun Islamic University

12 Pages Posted: 27 Jul 2011 Last revised: 4 Aug 2013

See all articles by Irawan Febianto

Irawan Febianto

University of Padjadjaran - Faculty of Economics, Department Management and Business

Arimbi Mardilla Ashany

Padjadjaran University - Department of Economics

Asrul Kautsar

Padjadjaran University - Department of Management

Date Written: July 2011

Abstract

The condition of zakah in Indonesia has become increasingly arising which is marked by changes of paradigm on zakah management. Formerly it was based on individual-traditional approach, but then it moved more on collective-professional approach. This is indicated by the emerging of many zakah-managing organizations that are more professional and offer creative programs. This has positive impact towards the improvement of the Indonesian economy. At the least, appropriate zakah allocation in the certain programs may significantly have impact on the increase of the Mustahiq’s Marginal Propensity to Consume (MPC) and also increase the producer’s production rate. In macro level, it will also impact on the increase of Third Party Fund in banks.

This paper will explain how zakah, with professional management, may fulfill the three aspects as mentioned above and hence the three will gradually alleviate poverty. Specifically, this paper limits the scope of research to only several programs of certain zakah-managing institutions that operate in Bandung, West Java, Indonesia. The method using in this paper is descriptive analysis regarding to the programs of zakah-managing institutions that have and have not been implemented. The analysis has reached to a conclusion that the programs can realize the increase of Mustahiq’s MPC thus converting them to become Muzakki, boost the producers’ level of production, and improve the balance of bank customers’ savings.

Keywords: Zakah programs, poverty alleviation

JEL Classification: A10, A12, A13, I31, I38

Suggested Citation

Febianto, Irawan and Ashany, Arimbi Mardilla and Kautsar, Asrul, An Analysis on the Impact of Zakah Programs In Poverty Alleviation: Case Study in Bandung, Indonesia (July 2011). Proceedings of the Zakat International Conference 2011, Bogor: World Zakat Forum, Bogor Agricultural Institute (IPB) and Ibnu Khaldun Islamic University, Available at SSRN: https://ssrn.com/abstract=1895109 or http://dx.doi.org/10.2139/ssrn.1895109

Irawan Febianto (Contact Author)

University of Padjadjaran - Faculty of Economics, Department Management and Business ( email )

Jl. Dipati Ukur. No. 35
Bandung, West Java 40115
Indonesia

Arimbi Mardilla Ashany

Padjadjaran University - Department of Economics ( email )

Jl. Dipati Ukur No.35
Bandung, 40132
Indonesia

Asrul Kautsar

Padjadjaran University - Department of Management ( email )

Jl. Dipati Ukur 35
Cimandiri 8
Bandung, West Java 40132
Indonesia

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