The Role of Zakat, Infaq, Shadaqah, and Waqf in Reducing Poverty and Economic Inequality

Abstract

Poverty and economic inequality are the main challenges facing Indonesia. As an instrument of sharia economics, Zakat, Infaq, Shadaqah, and Waqf (ZISWAF) has great potential to overcome this problem. This study aims to examine the role of ZISWAF in reducing poverty and economic inequality in Indonesia. The methodology used is quantitative descriptive analysis with secondary data collected from the ZISWAF institution, the National Amil Zakat Agency (BAZNAS), and government publications. The results of the study show that the targeted distribution of ZISWAF can improve the welfare of the poor and reduce income inequality. In addition, transparent and accountable management of ZISWAF can increase community participation in this program. In conclusion, ZISWAF has an important role in efforts to reduce poverty and economic inequality if managed properly. This study recommends increasing the management capacity of ZISWAF institutions and more intensive promotion to increase public awareness and participation.