Presented at Young Islamic Economic Forum (YIEF) 2017 in Conjuction with the 2nd Annual Islamic Finance Conference 23th - 24th August 2017, Yogyakarta, Indonesia

​#    ​​​Title ​  Authors
​​ ​​​2017 ​ ​
​ 2017

 Bringing the Zakat Distribution from the Principles to Financial Inclusion on Mission Mode

Muhammad Hasbi Zaenal,
Amelya Dwi Astuti,
Khonsa Tsabita

 

Abstract

We show how changes in poverty rate can be applied into growth of zakat distribution via financial inclusion on mission mode, and we use the methodology to zakat productive program in Sukabumi during the 2016. The purpose of the present paper is to prove zakat is able to be a solution part for the community empowerment. The result is the number of productive zakat program beneficiaries whose income is below the poverty line (poor category) before the program are 73 people (H = 0.081) and after the program change to 24 (H = 0.027), which means the program has succeeded in reducing the number of poor people by 49 people (5.47 percent). Despite the decrease of the number of headcount, the poverty gap (P1) after the program increased. The income gap (I) is also decline from 0.197 to 0.169. Poverty severity of beneficiaries of productive zakat program in Sukabumi seen by Sen Index (P2) decrease from 0.038 to 0.013, while using Foster-Greer-Thorbecke Index (P3), the poverty severity decrease from from 0.004 to 0.002. The analysis revealed the zakat for the community empowerment was significant economically in suppressing the poverty rate, and possible for reducing inequality and ending poverty in Indonesia.

Keywords: Zakat, Indonesia Poverty, Inequality Economics, Economics Growth

JEL Classification: O15, O53, P36

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