Trust Enhancement in Zakat Institutions using Blockchain Technology: A Qualitative Approach
Keywords:
blockchain, zakat, trust, zakat institution
Abstract
There is an indication that zakat institutions are inefficient and lack transparency in terms of distributing and managing their funds. This leads to a lack of trust between Muzakee and zakat institutions; hence, they prefer to pay zakat to Mustahiq directly. This means that zakat institutions may be collecting far less in zakat funds than the maximum amount that is potentially available. Meanwhile, the invention of blockchain technology has disrupted the financial sector as it offers transparency in transactions, meaning intermediaries are no longer needed. The use of blockchain in zakat management is important for improving transparency in the distribution of zakat. The objective of this paper is to explore the determinant factors that influence trust in zakat institutions using blockchain technology as a mediating effect. The results of the literature review revealed that these factors are reputation, satisfaction with zakat distribution, service quality and disclosure practice. This study expects that trust in zakat institutions can be enhanced through the use of blockchain technology.
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Zainal, H., Abu Bakar, A., & Saad, R. A. J. (2016a). Reputation,satisfaction of zakat distribution,and service quality as determinant of stakeholder trust in zakat institutions. International Journal of Economics and Financial Issues, 6(7S), 72–76.
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Zeithaml, V. A. (1988). Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence. Journal of Marketing. https://doi.org/10.1177/002224298805200302
Zubaidi, I. B., & Abdullah, A. (2017). Developing a Digital Currency from an Islamic Perspective: Case of Blockchain Technology. International Business Research, 10(11), 79. https://doi.org/10.5539/ibr.v10n11p79
Abratt, R., & Kleyn, N. (2012). Corporate identity, corporate branding and corporate reputations. European Journal of Marketing, 46(7/8), 1048–1063. https://doi.org/10.1108/03090561211230197
Abubakar, Y. S., Ogunbado, A. F., & Saidi, M. A. (2018). Bitcoin and its Legality from Shariah Point of View. SEISENSE Journal of Management, 1(4), 13–21. https://doi.org/10.33215/sjom.v1i4.32
Andayani, D. R., Hanum, K., Zaenal, M. H., Asmita, B., Damayanti, D. R., Fahrudin, & Kardiman, M. (2019). Statistik Zakat Nasional 2018. Retrieved from https://baznas.go.id/szn2018
Christidis, K., & Devetsikiotis, M. (2016). Blockchains and Smart Contracts for the Internet of Things. IEEE Access. https://doi.org/10.1109/ACCESS.2016.2566339
Crosby, M., Nachiappan, Pattanayak, P., Verma, S., & Kalyanaraman, V. (2016). BlockChain Technology: Beyond Bitcoin. In Applied Innovation Review.
Ellany, E., & Lateff, A. (2011). Faktor-Faktor Yang Mempengaruhi Pembayaran Zakat Pendapatan Di Malaysia. Persidangan Ekonomi Malaysia Ke VI(PERKEM VI).
Gray, E. R., & Balmer, J. M. T. (1998). Managing Corporate Image and Corporate Reputation. Long Range Planning, 31(5), 695–702. https://doi.org/10.1016/S0024-6301(98)00074-0
Gronroos, C. (1984). A Service Quality Model and its Marketing Implications. European Journal of Marketing. https://doi.org/10.1108/EUM0000000004784
Hudayati, A., & Tohirin, A. (2010). Management of Zakah : Centralized Vs Decentralised Approach. Seventh International Conference – The Tawhidi Epistemology: Zakat and Waqf Economy, Bangi 2010, (June), 351–374.
Jayanto, P., Jayanto, P. Y., & Munawaroh, S. (2019). The Influences of Reputation, Financial Statement Transparency, Accountability, Religiosity, and Trust on Interest in Paying Zakat of Profession. Jurnal Dinamika Akuntansi, 11(1), 59–69. https://doi.org/10.15294/jda.v11i1.18729
Kamaruzaman, N. E., Yassin, I. M., Zabidi, A., Zaman, F. H. K., Rizman, Z. I., Baharom, R., & Wahab, N. A. (2018). Blockchain technology for Islamic marriage certificate. International Journal of Engineering and Technology(UAE), 7(4), 193–197. https://doi.org/10.14419/ijet.v7i4.11.20802
Karim, R. A. A. (1990). Standard Setting for the Financial Reporting of Religious Business Organizations: The Case of Islamic Banks. Accounting and Business Research. https://doi.org/10.1080/00014788.1990.9728888
Lakhani, K. R., & Iansiti, M. (2017). The Truth About Blockchain. Harvard Business Review, 118–127. Retrieved from https://hbr.org/2017/01/the-truth-about-blockchain
Laroiya, C., Saxena, D., & Komalavalli, C. (2020). Chapter 9. Applications of Blockchain Technology. In Handbook of Research on Blockchain Technology. https://doi.org/10.1016/B978-0-12-819816-2.00009-5
Md. Idris, K., & Ayob, A. (2002). Peranan sikap dalam gelagat kepatuhan zakat pendapatan gaji. Analisis.
Mediawati, E. (2016). Research Article Internal Control and Sharia Supervisory Board Role in Zakat Management Organization. International Journal of Recent Advances in Multidisciplinary Research.
Morkunas, V. J., Paschen, J., & Boon, E. (2019). How blockchain technologies impact your business model. Business Horizons, 62(3), 295–306. https://doi.org/10.1016/j.bushor.2019.01.009
Mukhibad, H., Fachrurrozie, F., & Nurkhin, A. (2019). DETERMINANTS OF THE INTENTION OF MUZAKKI TO PAY PROFESSIONAL ZAKAT. Share: Jurnal Ekonomi Dan Keuangan Islam, 8(1), 45–67. https://doi.org/10.22373/share.v8i1.4573
Oliver, R. L. (1980). A Cognitive Model of the Antecedents and Consequences of Satisfaction Decisions. Journal of Marketing Research. https://doi.org/10.2307/3150499
Parasuraman, A., Zeithaml, V. A., & Berry, L. L. (1985). A Conceptual Model of Service Quality and Its Implications for Future Research. Journal of Marketing. https://doi.org/10.2307/1251430
Richard, J. E., & Zhang, A. (2012). Corporate image, loyalty, and commitment in the consumer travel industry. Journal of Marketing Management, 28(5–6), 568–593. https://doi.org/10.1080/0267257X.2010.549195
Samargandi, N., Tajularifin, S. M., Ghani, E. K., Aziz, A. A., & Gunardi, A. (2018). Can disclosure practices and stakeholder management influence zakat payers’ trust? A malaysian evidence. Business and Economic Horizons. https://doi.org/10.15208/beh.2018.60
Schnackenberg, A. K., & Tomlinson, E. C. (2016). Organizational Transparency: A New Perspective on Managing Trust in Organization-Stakeholder Relationships. Journal of Management. https://doi.org/10.1177/0149206314525202
Tama, B. A., Kweka, B. J., Park, Y., & Rhee, K.-H. (2017). A Critical Review of Blockchain and Its Current Applications. International Conference on Electrical Engineering and Computer Science (ICECOS) 2017 A, 109–113.
Wang, H., Zheng, Z., Xie, S., Dai, H. N., & Chen, X. (2018). Blockchain challenges and opportunities: a survey. International Journal of Web and Grid Services, 14(4), 352. https://doi.org/10.1504/ijwgs.2018.10016848
Yang, Y., Brennan, I., & Wilkinson, M. (2014). Public trust and performance measurement in charitable organizations. International Journal of Productivity and Performance Management. https://doi.org/10.1108/IJPPM-09-2013-0159
Zabri, M. Z. M., & Mohammed, M. O. (2018). Examining the behavioral intention to participate in a Cash Waqf-Financial Cooperative-Musharakah Mutanaqisah home financing model. Managerial Finance, 44(6), 809–829. https://doi.org/10.1108/MF-05-2017-0189
Zainal, H. (2016). The Role of Reputation, Satisfactions of Zakat Distribution, And Service Quality in Developing Stakeholder Trust In Zakat Institutions. 524–530. https://doi.org/10.15405/epsbs.2016.08.74
Zainal, H., Abu Bakar, A., & Saad, R. A. J. (2016a). Reputation,satisfaction of zakat distribution,and service quality as determinant of stakeholder trust in zakat institutions. International Journal of Economics and Financial Issues, 6(7S), 72–76.
Zainal, H., Abu Bakar, A., & Saad, R. A. J. (2016b). Reputation,satisfaction of zakat distribution,and service quality as determinant of stakeholder trust in zakat institutions. International Journal of Economics and Financial Issues, 6(7Special issue), 72–76. Retrieved from http:www.econjournals.com
Zeithaml, V. A. (1988). Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence. Journal of Marketing. https://doi.org/10.1177/002224298805200302
Zubaidi, I. B., & Abdullah, A. (2017). Developing a Digital Currency from an Islamic Perspective: Case of Blockchain Technology. International Business Research, 10(11), 79. https://doi.org/10.5539/ibr.v10n11p79
Published
2022-04-22
How to Cite
Zulfikri, Z., Adam, A., Kassim, S., & Hassan, A. (2022). Trust Enhancement in Zakat Institutions using Blockchain Technology: A Qualitative Approach. European Journal of Islamic Finance, 9(1), 31-36. https://doi.org/10.13135/2421-2172/6312
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