KUALA LUMPUR: Malaysia’s waqf (endowments) is moving towards digitalisation and is looking at using blockchain technology and artificial intelligence.
Mujahid Yusof Rawa, Minister in the Prime Minister’s Department in charge of religious affairs, said a committee has been incorporated to look into these changes in technology and its compliance with shariah principles.
“We are at the stage of formalising the way forward and hope to complete this by the year end.
“By early 2020, we hope the committee will come up with ideas and be the first religious administration using digitalisation,” he said after launching the World Bank report titled “Maximising Social Impact Through Waqf Solutions” at Sasana Kijang here today.
Mujahid said despite the widespread presence of waqf institutions and the significant strides in waqf property management and development, waqf faces a number of issues and challenges.
Among these, he added, is the need to create public awareness and acceptance, to create comprehensive and enabling regulatory frameworks, and to empower professional waqf management.
“Currently, there is a lack of professional management culture among waqf administrators and a lack of transparency in managing waqf funds in a number of jurisdictions.”
Mujahid said another critical challenge is the collection of cash waqf through online platforms.
“There is still no regulatory framework to ensure transparency and integrity of such collections vis-à-vis the stakeholders.
“Recent developments in the digital economy can play a crucial role in addressing the issue of transparency and trust.
“These include facilitation of payments through digital wallets and the possible use of blockchain technology,” Mujahid said.
He urged waqf managers to embrace digital finance to enhance the efficiency of waqf collection and distribution.
“A strong governance and professionalism in waqf management are necessary to gain public trust in the Islamic collective endowment system.”
He also said the Waqf Act will be tabled in Parliament by the end of the year and is still pending reviews and discussions with various stakeholders, including the state governments and Malay rulers.
Present was Bank Negara Malaysia Assistant Governor Adnan Zaylani Mohamad Zahid, the World Bank group country manager for Malaysia, East Asia and the Pacific Firas Raad, Inceif president & CEO Azmi Omar and International Shari’ah Research Academy for Islamic Finance (Isra) executive director Mohamad Akram Laldin.
The report, produced by World Bank Group’s Global Knowledge and Research Hub in Malaysia, Inceif and Isra, gives an overview of the waqf landscape and highlights the potential of waqf institutions.
It showcases living examples of waqf best practices that applied modern management techniques competently and transparently for others to emulate.
The report revisits the enabling legislation and regulatory frameworks of selected jurisdictions and their inherited juristic opinions.
It discusses factors that facilitate as well as hamper the development of waqf in the respective jurisdictions.
Firas Raad said achieving the sustainable development goals by 2030 will require an estimated US$5- US$7 trillion of annual investment across various sectors and industries.
“With just 11 years left to the 2030 deadline, waqf structures can play an important role in bridging financing gaps,” he added.