Penelitian

Zakat and Microfinance

Abstrak

Microfinance achievements in poverty reduction, education improvement of the children of the poor, and creation millions of small businesses by becoming economically independent have been recorded around the globe. Recognition on its bold formalization and shifting from a grass-roots paradigm into inclusion in financial system paradigm were stated in MDG’s 2020 Vision and 2006 Nobel Peace Prize to Mohammad Yunus and the Grameen Bank (Bangladesh). In case of Malaysia, Amanah Ikhtiar Malaysia (AIM), the most dominant and successful MFI in Malaysia, other than produced positive impacts to the borrowers, also managed to put itself highly competitive comparatively with other MFIs. In order to ensure its mission in the future, AIM’s needs to secure its continuous access to financial sources both, at home and/or abroad. The objective of this paper is to provide a conceptual framework on how to channel Zakat to the poor through microfinance.

Keyword

Zakat, Microfinance.