SEMINAR ON SADAQA HOUSE 2015
The idea of Sadaqa House was first mentioned by the Royal Award winner of Islamic Finance 2014, Dato Dr. Abdul Halim Ismail during his speech in the Global Islamic Finance Forum 2014. His wish is to implement Sadaqa House as one of a banking product. According to the royal award winner, both government sector and the private sector have a role to play in the social welfare sector. The duties are almost solely to raise funds to the poor and needy in the social welfare sector. The function of Islamic banking and finance is to develop products and services to facilitate the flow of funds. However, Islamic banking and finance did almost nothing along this line. Most of collection of zakat and waqf is done by government sector and not the private sector, and largely not through banking and finance. It is the royal award winner wishful thought that Islamic banking and finance to embark on efforts to develop products and services for the social welfare sector. This is to be just one new line of development.
Sadaqa House can be in the business of providing products and services to collect various types of sadaqah, waqf, hibah and etc, mainly from the private sector and distribute these to the poor and needy in the social welfare sector. An important requirement here is that the Sadaqa House is owned and controlled by the banking group or any other organisation which is given license. There should be a need for such an Act of Parliament and various Bank Negara Malaysia guidelines which specifically spell out important matters such as licensing and Sadaqa House financial requirements and duties of Sadaqa House ownership, control and management of Sadaqa House; power of supervision and control over Sadaqa House and etc.
As Sadaqah Jariah is Charity in Perpetuity, in essence in the category of charity, the principal charity amount is to be preserved intact forever, and only the profits are distributed regularly. In the royal award winner’s view, Sadaqa House should accept sadaqah only in cash. The Sadaqa House may accept sadaqah at a minimum of RM10 at one time at any time through deposit, bank transfer, salary deduction and etc.
Sadaqa House needs a clear and concise plan for the periodic distribution of the profits. The individual Sadaqa House may prefer to specialise in one or two specific areas such as the livelihood of the poor and needy, health services, education services and others. If this movement becomes reality, it will reflect that Islamic banking and finance is based on a three-sector Islamic economy and it integrally incorporates the social welfare sector.
- To provide a platform for academicians and industry players to discuss on the issues and solutions in implementing sadaqah house as a banking product.
- To exchange ideas among academicians and industry players on sadaqa house.
- To provide recommendation to the policy makers in implementing sadaqa house as a banking product.