‘Zakat can save the world’ … and this is how

May 11, 2022

3 smiling children — Three happy children. Several global charities that help children and other groups in need now have Zakat policies

International charities hit hard by the pandemic are turning to Zakat, which requires Muslims to donate a percentage of their wealth to help the needy

As countries rich and poor reeled from the impact of the coronavirus pandemic in 2020 and 2021, the work of charities was more important than ever. Yet many of these organisations were struggling to survive after a sharp fall in donations.

Research by the UK’s Charity Commission, released in October 2021, found that more than 90 percent of fundraising groups had experienced a negative impact from Covid-19 while 62 percent anticipated some level of threat to their future in the next 12 months.

To combat this threat, more and more non-Muslim charities are turning to Zakat, a concept that was largely unknown outside the Muslim world until a decade ago.

Zakat is the third pillar of Islam, requiring Muslims to give a percentage of their qualifying wealth (2.5 percent for the lunar year calendar and 2.5775 percent for the solar year calendar) each year to help the needy.

It is considered mandatory, although not all Muslims abide. In many countries with large Muslim populations, individuals can choose whether or not to pay. In nations such as Libya, Malaysia, Pakistan, Saudi Arabia, Sudan and Yemen, collection is state-led and compulsory.

One high-profile charity that has recently turned to Islamic forms of giving is Save the Children UK. It was advised by law firm Norton Rose Fulbright as it developed a Zakat fundraising policy, which has been endorsed with a fatwa by Islamic scholar Shaykh Haytham Tamim. This will allow Muslim philanthropists to give their Zakat in a Shari’a-compliant way to the world’s most marginalised children.

‘The pandemic has really fast-tracked the ability to accept Zakat’

Zia Salik, head of fundraising at Islamic Relief, a non-governmental organisation (NGO) founded in the UK in 1984 by a group of doctors and activists, explains that the impact of the pandemic, alongside the development of online payment technology, has piqued the interest of non-Muslim charities.

“Many major NGOs have been hit hard by the pandemic so for them it makes sense to build a Zakat infrastructure… The pandemic has really fast-tracked the ability to accept Zakat alongside the need to make it much easier to donate online… Their investment in the digital space is in line with the development of Zakat infrastructure because this is seen as almost a lifeline for many,” he said.

Recent estimates suggest as much as $1 trillion is donated annually so the ramping up of the Zakat proposition by non-Muslim charities should perhaps be expected.

There are more than 2 billion Muslims worldwide, making Islam the second-largest religion in the world. Researchers estimate that Muslims will outnumber Christians by 2050.

Zia Salik, head of fundraising at Islamic Relief.

Salik is in no doubt about the global potential of Zakat. “Zakat can save the world… We believe Zakat was ordained to the world to eradicate poverty,” he said.

He cited figures from the United Nations that suggest it would cost about £300 billion ($370 billion) to achieve its first two Sustainable Development Goals to end global poverty and hunger. “It is a simple equation. We are talking about huge, huge figures,” he added.

“We’ve seen incredible growth. Charities and NGOs recognise the potential of Zakat donations and many have worked hard to build the infrastructure because collecting Zakat is easy but distributing it is the real challenge. Those that have taken it seriously have taken a lot of time and resources to get the infrastructure right. For sure, a lot of organisations are now seeing the value of Zakat,” said Salik.

Save the Children, which operates in more than 100 countries including the UK, said its Zakat policy would facilitate the raising of vital funds to support children in Muslim-majority countries in which Save the Children operate, to get a healthy start in life, keep learning and stay safe.

Payments will be held in a Zakat fund and distributed within one lunar year of giving.

A spokesperson for the charity said: “In terms of the wider charity sector, we wouldn’t necessarily characterise it as a trend but many other NGOs and UN agencies are now also recognising the impact that could be created through Islamic forms of giving, such as Zakat.”

UN supports Zakat to aid millions of refugees

With more than 82 million displaced people across the world, the United Nations High Commissioner for Refugees is another high-profile supporter of Zakat. Last year it launched a mobile app version of its Zakat Refugee Fund. UK charity Oxfam is also receiving donations.

According to Islamic Relief, if the 10 richest people in the world paid Zakat, it would raise £7.7 billion alone. It describes Zakat as “a revolutionary concept with the potential to ease the suffering of millions around the world”.

Non-Muslim charities interested in Zakat have to do their homework. Salik said: “Problems arise when organisations see Zakat as a bit of a buzzword and they throw Zakat on their website and say ‘give your Zakat to us’ but there is no policy, there is no infrastructure, no training and no real knowledge…

“Zakat is a religious obligation and duty so it has to be treated as a sacred job and not just another pot from which we can raise money.”

Most non-Muslim charities are “taking Zakat seriously”, however, and Salik sees strong growth for Islamic giving globally. “We have a massive marketing campaign in the UK and the US and Canada to push the message that Zakat can end hunger. The more people hear about Zakat the more they buy into the concept and say it’s brilliant and they are starting to see that it is the answer to global poverty.”

A beginner’s guide to Zakat

In simple terms, Zakat is calculated as 2.5 percent of your savings and financial assets that are not used towards your living expenses
Any income spent on house payments, domestic bills or essential needs is not included in the calculation
Nisab is the minimum amount of wealth that acts as a threshold to determine whether Zakat is obligatory on you
If what you own is more than Nisab, it means you are eligible to pay Zakat that year. If it is less, then you don’t need to pay Zakat
In Islamic law, the Nisab by the gold standard is 3 ounces (87.48 grams) or its equivalent in cash. The Nisab by the silver standard is 21 ounces (612.36 grams) or its cash equivalent. Online calculators are available to help
The purpose of Zakat is to make sure the poor and the needy, the vulnerable and the disadvantaged are looked after

Top 10 most generous countries in 2020 …

Figures from the Charities Aid Foundation’s World Giving Index