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BI plans to maximize Rp 300t Islamic charity fund
Bank Indonesia Deputy Governor Perry Warjiyo Bank Indonesia (BI) is paving the way to empower the obliged donation in Islam (zakat) and Islamic charity (waqf), which has the potential to reach Rp 300 trillion (US$22
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Bank Indonesia Deputy Governor Perry Warjiyo
Bank Indonesia (BI) is paving the way to empower the obliged donation in Islam (zakat) and Islamic charity (waqf), which has the potential to reach Rp 300 trillion (US$22.23 billion), by changing them into Islamic bonds (sukuk) in a bid to maximize the fund to boost the economy.
BI's Senior Deputy Governor Mirza Adityaswara said that both Islamic social funds were huge economical assets but had yet to be financially maximized, thus ending up as lump-sum charity funds with limited multiplier effects.
If the waqf asset was coordinated well, it may be used as an underlying asset to issue sukuk, which ultimately could be used to finance Islamic economic activities, he said to the press on Wednesday in Surabaya.
Therefore, he continued, Indonesia's central bank prepared a way to empower the waqf and the zakat fund.
BI's Deputy Governor Perry Warjiyo added that the central bank had spoken with the Islamic Development Bank (IDB) and some Islamic economy experts to issue an international core principle of zakat and waqf.
The core principle of zakat will be issued next year, while the core principle of waqaf is still being processed. Under new guidance, we may attach social financing to Islamic banking as zakat management is closely related to sharia-based banking, he said.
At the moment, he continued, Indonesia had several zakat fund collectors with their own standards. Under the core principle, which would be the international best practice for zakat management, they would be rated in terms of collection, transparency and distribution, including risk mitigation.
Under the new standard, zakat fund collections and distribution would closely involve the Islamic banking system and might be effectively used to empower the society, Perry asserted.
According to BI's data, the registered waqf in Indonesia is at least worth Rp 300 trillion, from around Rp 2.4 quadrillion of potential waqf in the country. If we use them as the underlying asset of sukuk, we have a huge amount of funds for big projects and small financing, Perry added.
As for now, he continued, the government has boosted the sukuk market by facilitating the corporations to issue sukuk, besides issuing several sukuks through the Finance Ministry to finance the infrastructure project. (dan)
