Finance & Banking

BAZNAS BADAN AMIL ZAKAT NASIONAL

BAZNAS HAS BEEN ESTABLISHED IN 498 REGIONS (PROVINCIAL AND REGENCY / CITY LEVELS) OF INDONESIA, IT COLLECTS AND DISTRIBUTESS INFAQ AND ALMS ZAKAT AT THE NATIONAL LEVEL

Introduction
Baznas is the zakat management body formed by the Indonesian government through a Presidential Decree (Kepres) No 8/2001. As one of the five pillars of Islam, Zakat is a form of philanthropy found around the world. All Muslims,
eligible to pay it, must donate at least 2.5 per cent of their accumulated wealth. As such, it is one of the largest forms of wealth transfer to the poor and needy in existence. Zakat is now a global phenomenon not limited to only Muslim majority countries.

Role of BAZNAS
BAZNAS has been established in 498 regions (Provincial and Regency / City levels) of Indonesia, it collects and distributess Infaq and Alms zakat at the national level. The role of the National Zakat Board as an institution authorised is to manage the national zakat. Zakat potential in Indonesia ranges around IDR233 trillion in 2020 With the amount of 202 million Muslims, this can alleviate poverty in Indonesia.

Vision
The vision of The National Zakat Board of The Republic of Indonesia (BAZNAS) aims at becoming the best and the most trusted zakat institution in the world.

THE VISION OF BAZNAS AIMS TO BE THE BEST AND THE MOST TRUSTED ZAKAT INSTITUTION IN THE WORLD

Mission
• Coordinate BAZNAS and private zakat institutions in provincial and city/district level to achieve national targets
• Optimize measurably national zakat collection
• Optimize distribution and utilization of zakat to eradicate poverty, improve community welfare and moderate social
inequality
• Implement transparent and accountable financial management system based on the latest information and communication
technology
• Implement excellent service system to all national zakat stakeholders
• Mobilizing Islamic da’wah for the awakening of national zakat through the synergy of the ummah
• Actively involved and lead the world zakat movement
• Mainstream zakat as an instrument of development towards a just and prosperous society, baldatun thayyibatun wa rabbun
ghafuur
• Developing the competency of amil zakat to become a world reference

Awards & Recognition
• Top Digital Implementation on Social Institution Sector (Top Digital Awards 2020)
• Best Zakat Service Institution – Philanthropy Sector (Anugerah Syariah Republika 2020
• ISO 9001:2015 – Quality Management System (2020)
• Best Digital Fundraising (Indonesia Fundraising Awards 2020)

• Best Zakat Distribution Programme (Global Islamic Finance Award 2020)
• 3G SDGs Champion Award – Social Sector and Philanthropy (Cambridge IFA 2020)
• Best Scholarship Program (Indonesia Scholarship Awards 2019)
• Padmamitra Awards 2019

BAZNAS HAS ENTERED INTO A PARTNERSHIP WITH UNICEF

The collaboration between BAZNAS and UNICEF for children was motivated by the humanitarian crisis in Indonesia
and in those in OIC countries. It will cover various fields ranging from education, health, nutritional adequacy, access
to clean water, child protection and social, youth empowerment.

More than two thirds of the funding are required for children caught up in humanitarian crises, and for the work in
Organisation of Islamic Cooperation countries. Humanitarian crises in some countries have taken a heavy toll,especially
on children. This has become a mutual concern of BAZNAS and UNICEF. Fundraising and distribution of aid through
collaboration is guaranteed to be conducted professionally and in accordance with the laws and Shari’a.

This form of assistance is sustainable and focused on children and young people, so that they could have a better
future. The benefit can go a long way, helping families rise from adversity following humanitarian crises, in a hope that
they can achieve prosperity.

BAZNAS SIGNS ITS FIRST EVER AGREEMENT IN SUPPORT OF UNRWA

The United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) has signed the first agreement with Indonesia’s national Zakat agency, BAZNAS. The agreement marks an important partnership for the Agency in promoting its #DignityIsPriceless Campaign and narrowing the gap of its unprecedented financial crisis. BAZNAS delivered aid for education programme to support more than 600 Palestine refugee children in Jordan.

Role of BAZNAS as a non-structural state institution

It has various poverty alleviation programmes such as zakat community development, BAZNAS Microfinance, agriculture and livestock programme, etc. These programmes will be more optimal if the income distribution
is smooth enough. One area that also has an important role in the economy is distribution including income distribution.

Income distribution is the focus of the basic objectives of Islam to reduce economic inequality between the rich
and the poor. Economic inequality can be reduced if the entire community can meet the basic needs of life or if in
Islam can meet the needs of Dharuriyatnya. In order to realise the welfare of the Indonesian people, integration of government institutions related to poverty is needed. Like the Ministry of Education and Culture and the Ministry of Health, the role of BAZNAS as an official non-structural state institution is considered important. That is because BAZNAS has the function of collecting zakat, infaq and alms from muzakki and distributing zakat, infaq and alms to the mustahiq.
This important role is supported by BAZNAS programmes which are quite comprehensive in alleviating poverty in Indonesia. Based on this background, the formulation of the problem in this paper is whether zakat funds, education expenditures, health expenditures affect poverty.

IsDB and BAZNAS Launch Project to Unlock Zakat Potential for Poverty Alleviation and COVID-19 Response

As per its role, BAZNAS focuses on helping the poor in Indonesia. In these pandemic days, the poor are the most
affected, not only health-wise, but many have also lost their jobs and income. With this IsDB funded project, it is
expected that more and more poor people will be supported to recover their livelihoods and cope with the pandemic.
The Islamic Development Bank (IsDB) Group and Indonesia’s National Board of Zakat (BAZNAS), the country’s sole official entity to manage Zakat funds are partnering in a transformative and pioneering pilot strategic Technical Assistance (TA) project to integrate Zakat with some of Indonesia’s Community Driven Development (CDD) Programmes.

The (TA) project seeks to leverage crowdsourcing’s enormous potential, motivating the crowds to become
an active network of developers. The TA project seeks to develop a model to improve the collection of Zakat,
and effectively channel and maintain a sustainable flow of funds to support successful national-level CDD
programmes, which have strong grassroots poverty reduction and livelihood enhancement impacts. IsDB President’s Five-Year Programme (P5P) and the New Business Model to create partnerships and transform the IsDB into a Bank of developers. In particular, the P5P’s aim is to make the IsDB more competitive and responsive to the needs of its member countries. The programme also aims to make the IsDB the partner of choice in addressing development challenges by achieving the six key pillars namely awareness, linkages, competency, funding, delivery and reinforcement.

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