KUALA LUMPUR: The International Centre for Education in Islamic Finance (INCEIF) is developing a blockchain application for zakat, with the aim of enhancing the Islamic fund collection and distribution in the world.
The initiative would help to address issues pertinent to zakat, especially with regards to trust and transparency, said president and chief executive officer, professor Datuk Azmi Omar.
He said the adoption of technology, not only in relation to zakat but also other Islamic assets such as waqf and sadaqa, was crucial with the advent of the Fourth Industrial Revolution.
“Right now, we don't know if the money goes to the most deserving zakat recipients or the right projects.
“Blockchain helps to provide transparency and traceability. You will know where the money goes to, from the beginning right to the end of the project, who the recipients are and what the fund was used for,” he told Bernama.
Earlier on, Azmi had delivered the keynote address at the World Bank-INCEIF-International Shari’ah Research Academy for Islamic Finance roundtable on “Maximising Social Impact Through Waqf Solutions” here yesterday.
He said INCEIF had been collaborating with the International Federation of Red Cross and Red Crescent Societies to develop the application which was currently being tested in Pakistan.
As for Malaysia, he said the application would be jointly developed with the International Business Machines Corporation (IBM) regional office.
Azmi expressed hope that the blockchain application for zakat could be implemented in Malaysia by year-end, making the country the first nation in the world to adopt the technology for that purpose.
“We already have the proof of concept. Now we are in discussions with a state religious authority, and a working paper will also be submitted to a high-level Institution of lslamic Affairs Committee,” he said.
Consent from the Conference of Rulers would be required, he said, as the current mode of collection and distribution needed to be improved.
“Blockchain is a proven concept, so I don't think there will be an issue,” he added. — Bernama