Sustainable mechanisms of distributing financial assistance to Asnaf and B40 entrepreneurs in Malaysia: case study of Bank Kerjasama Rakyat Malaysia Berhad
The post COVID-19 pandemic has notably highlighted the adverse impacts on both the global and Malaysian economic landscape. This is particularly evident in Asnafgroups (zakat recipients) and individuals within the B40 category. Islamic financial institutions (IFIs) in Malaysia, more specifically, Ba...
Saved in:
| Main Authors: | , , , |
|---|---|
| Format: | Article |
| Language: | English |
| Published: |
IIUM Institute of Islamic Banking and Finance (IIiBF),
2024
|
| Subjects: | |
| Online Access: | http://irep.iium.edu.my/115804/1/115804_Sustainable%20Mechanisms%20of%20Distributing.pdf http://irep.iium.edu.my/115804/ https://journals.iium.edu.my/jisf/index.php/iiibf/article/view/23/19 |
| Tags: |
Add Tag
No Tags, Be the first to tag this record!
|
| Summary: | The post COVID-19 pandemic has notably highlighted the adverse impacts on both the global and Malaysian economic landscape. This is particularly evident in Asnafgroups (zakat recipients) and individuals within the B40 category. Islamic financial institutions (IFIs) in Malaysia, more specifically, Bank Kerjasama Rakyat Malaysia Berhad, or Bank Rakyat, as a full-fledged Islamic Cooperative Bank, has played a pivotal role in providing financial aid to these vulnerable groups through zakat assistance across a spectrum of initiatives and programs. This study aims to explore Bank Rakyat’s initiatives, specifically its sustainable entrepreneur's program, namely “RAKYATpreneur” and “UNIpreneur”. Employing a qualitative approach, it reviews relevant literature on Islamic microfinance and analyses the effectiveness of the RAKYATpreneur and UNIpreneur programs. The study focuses on these initiatives as a key objective of Islamic banks, seeking to make a positive contribution to both society and economic development through the effective distribution of zakatfor sustainability in the long run. Furthermore, this research provides some recommendations to revitalise Islamic social finance products by transforming the zakat mechanism from consumptive to productive distribution, thereby unlocking its full potential. It also proposes a potential structure using Qardcontract for microfinancing purposefor ensuring sustained business cash flow for continuous feasibility. |
|---|