INDONESIA BANK DEVELOPS INTERNATIONAL ZAKAT AND WAKAF SECTORS

Jakarta, 5 Dzulqa’dah 1435/31 August 2014 (MINA) – Indonesian Central Bank (Bank Indonesia, BI) along with the National Zakat Agency (BAZNAS, Badan Amil Zakat Nasional) and the Islamic Research and Training Institute-Islamic Development Bank (IRTI-IDB) attempts to raise awareness of the international zakat and wakaf sectors.

“We expect to strengthen development of international zakat and wakaf sector,” said Deputy governor of BI, Halim Alam at the international seminar with theme “Inclusive Islamic Financial Sector” at the Head Office of Indonesia Bank, Jakarta, Thursday (28 august 2014).

He spoke in front of participants comprising academics, representatives of zakat and wakaf authorities in several countries such as Qatar, Malaysia, Sudan, Saudi Arabia and multilateral institutions such as the World Bank and Islamic Development Bank.

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According to him, the involvement of BI was a form of the central bank’s role in encouraging potential economic sector within the framework of sustainable economic development programs.

“Improving the quality of governance of international zakat organizations are expected to encourage the achievement of financial inclusion (affordable financial services community) through the strengthening of the broader production base and expanding public access to Islamic financial services,” he said.

Moreover, the Islamic social sector including zakat and wakaf had potential fund of about Rp217 trillion or $18.56 billion. The fund could play important role in accelerating economic development and supporting financial stability, he added.

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He added, the existence of an efficient zakat organizations would increase the range of services to segments of society that have not been touched by banking institutions. With national zakat that reaches around Rp4 trillion or $342.2 million per year, increasing capacity of zakat management would open opportunity for communities getting services and security of basic consumption needs, especially in difficult situation, he said.

“Strong production base with broader segment and maintaining public consumption in the long term, can increase economic resistance, especially from crisis condition,” said Alam.

In fact, he asserted, the system could increase the self reliance well. Thus, it have strong connection with role of Bank Indonesia in achieving stability of the financial system and the national economy.

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Following up the meeting, BI plans to form the International Working Group on Zakat Core Principles to formulate principles of regulatory framework and supervise zakat institutions internationally. These principles is expected to complete standard setting for zakat sector. The process of preparation of these principles involve stakeholders (decision makers) at the international level so it is expected to have high acceptability. (T/P4/P009/P3).

Mi’raj Islamic News Agency (MINA)