MUI: Realization of Cash Waqf in Indonesia is Still Below 10 Percent

Jakarta, MINA – Chairman of the Indonesian Ulema Council (MUI) for the Economic Development of the People, Lukmanul Hakim said the potential for cash waqf in Indonesia is very large. Unfortunately, the realization is still below 10 percent.

In addition, several survey institutions in the world report that Indonesia occupies the position of the most generous country in the world.

“The financial potential of the Islamic Social Fund in Indonesia is actually very large. The potential for cash waqf is IDD 188 trillion. This land is 480,000 hectares. This is huge and can increase people’s purchasing power,” he said on Friday.

He saw that the small realization of the achievement of cash waqf was most likely due to the lack of literacy in the community. This is evident from the number of institutions in the community that are involved in cash waqf, but the realization is still small.

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The government has long even had an Indonesian Waqf Board. Recently, the Government also launched the National Money Waqf Movement. Even civil society organizations and the private sector have been engaged in this field for a long time.

Lukman, who is also the Chairman of the MUI Waqf Institution, said that one thing that the public may rarely understand is the cash waqf scheme. According to him, so far, the public’s view of waqf is about buildings or land.

Although there are benefits to society, it is less profitable from an economic point of view. Land and building waqf, although slightly profitable, are not flexible.

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While cash waqf, with its flexible nature, can be used to help provide capital for many people.

He emphasized that the use of the cash waqf was not the principal, but the returns from the management of the cash waqf. The principal value of the cash waqf will remain.

“The main value of this cash waqf must be guaranteed for its sustainability. We at the MUI Waqf Institute often discuss how waqf is invested in the real sector or the people’s economy. Maybe they are not bankable (not yet eligible for bank financing) but feasible and profitable. This can use the waqf mechanism,” he said.

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He added that cash waqf schemes do not always have to be included in bank schemes. Obstacles in the banking world can be overcome by overcoming these obstacles.

“Don’t think that waqf is always included in the bank scheme, it’s not always like that. How about when entering a bank scheme, the business is feasible, profitable, but not bankable, so here the non-bank cash waqf scheme is used. I think the MUI Waqf Institution has started to act as part of the national movement,” he said. (T/RE1)

Mi’raj News Agency (MINA)