Can Crowdfunding Empower Waqf Collection in Malaysia? (Malaysian Journal of Syariah and Law)

Summary

• The study uses a qualitative exploratory approach with semi-structured interviews of ten experts and practitioners in waqf management and crowdfunding.p.1
• Waqf matters in Malaysia fall under State Islamic Religious Councils (SIRCs), so each state has different standards and collection is limited by jurisdiction.p.2
• The MyWakaf platform is operated by the Association of Islamic Banking and Financial Institutions Malaysia (AIBIM) and links Islamic banks with SIRCs.p.7
• Interviewees reported that online waqf collection can increase the total amount raised but has not yet surpassed traditional collection methods.p.13
• Waqaf An-Nur provides microfinancing of up to RM 20,000 through tawarruq and up to RM 7,000 through qard hassan.p.14
• Waqaf An-Nur allocated RM 2,144,600 for its microfinance programme in 2024.p.14
• Current practice in Malaysia is limited to donation-based crowdfunding; the authors propose blended financing combining waqf funds and equity-based crowdfunding.p.15

Key insights

1. Waqf collection in Malaysia has experienced low levels of collection, limiting its socio-economic impact.p.2
2. Low collection is linked to low awareness, ineffective communication and marketing, and staff shortages.p.5
3. Campaigns on university crowdfunding platforms often struggle, with many projects failing to meet their funding targets.p.8
4. All informants agree that digital platforms can enhance transparency in collecting waqf and managing its funds.p.11
5. Informants noted that tax exemption for waqf funders would make online crowdfunding for waqf more appealing.p.12
6. According to the World Bank (2018), SMEs account for at least 90% of businesses globally and approximately 50% of total employment.p.14
7. Only two institutions, Waqaf An-Nur and Yayasan Wakaf Malaysia, currently offer waqf-based microfinance products.p.14
8. MyWakaf campaigns pair an Islamic bank with a SIRC, for example the Hemodialysis Centre in Terengganu with Bank Rakyat.p.15