Enhanced Functionalities of E zakat system

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Enhancing Functionalities by Providing
“Trust” Element in E-Zakat System
Muhammad Khairul Na’im Kamaruddin
2015707059
Faculty of Computer and Mathematical Sciences
Universiti Teknologi Mara, Shah Alam
1. Abstract
This paper intends to highlight some of the current issues and problems regarding zakat
collection, payment as well as distribution in Malaysia. In this paper, one of the human element
or key factor when interacting with E-Zakat System is known as “trust” will be highlighted in
depth in order to improve E-Zakat System in Malaysia. The current issues of E-Zakat System are
briefly described in the research. The workflow or processes on how trusted E-Zakat system
should functioned are also highlighted in the paper.

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2. Introduction
As a Muslim, zakat is known as one of the five pillars of Islam, it is a duty to each Muslims to
obey as zakat has been made obligatory by Allah instructing every Muslims who are able to
conduct it. According to (Monitor, et.al 2012), each Muslims, consisting male and female, who
owns a surplus of wealth and have capabilities in term of wealth, must pay zakat at the end of the
Hijri year.
The total of zakat collection has been increased drastically yearly right now. It might be due to
the emerging trends of automated payment methods such as via internet banking right, mobile
applications as well as through E-Zakat Systems available, efficiency of zakat management,
zakat institution privatization, escalation of zakat payers and their incomes and so on
(Hairunnizam et. al, 2008; p. 806). Although the management of zakat collection is getting better
from year to year, but the issue of zakat distributions still caused a lot of problems, arguments as
well as discussions.
The difficulty with the distribution methods, distribution process to the qualified and unqualified
“Asnaf”, the problem with poverty that is still happen even though the zakat distribution has
been implemented, some zakat institution having shortage zakat fund while some having surplus,
are among the issues that has decreased the performance and achievement of the zakat institution
itself (Mohamed Dahan 1998; Abdullah 1999).
The term “Asnaf” can be defined as the beneficiaries categorised into eight (8) categories of
people defined in the holy Quran as those who are entitled to receive zakat.
This study will investigate the suitable solution, which can be applied in order to enhance the
existing method consisting of any payment channels available in Malaysia in term of zakat fund
distribution in Malaysia and most importantly is to developed trusts for the potential zakat
contributor to contribute zakat to any zakat organization and channel in Malaysia.

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3. ResearchBackground
According to Mahyuddin Haji Abu Bakar (2011) in the article “Towards Achieving the Quality
of Life in the Management of Zakat Distribution to the Rightful Recipients (The Poor and
Needy)”, the details and explanation regarding the 8 beneficiaries in Malaysia based on the data
provided in 9th Malaysia Plan (RMK 9) are described briefly as follows:
1. “Faqir” can be defined as group of people whose property is below the certain amount of
threshold. They are poor and destitute and need other people’s help to survive, either
because of their physical inability, old age or others. In the context of Malaysian income
measurement, the poverty line income (PLI) is RM 661 a month per household (4-6
people) in Peninsular Malaysia and RM 691 a month in East of Malaysia. According to
the 9th Malaysia Plan, the household income for the “faqir” is below than food
consumption which is RM400 a month (Economic Planning Unit, JPM (2006), RMK 9
(2006-2010).
2. “Masakin” consisting of the poor whose incomes range between RM 400 to RM 691 for
every household in the Malaysian context (RMK9).
3. “Amilin” can be described as those who work in administering and managing matters
related to zakat. Inclusive in this category are the officers and members of the staff
appointed by the state to manage zakat matters such as calculation, collection and
disbursement. This group of people is entitled to be paid from the zakat fund.
4. “Muallafat al Qulub” are the group of people those who are inclined to be close to
Islam. Those in this category include those who have close relationship and strong
commitment to solidify Islam such as the newly converts who have to give up their
property and family relations. The gift of zakat is hoped to strengthen their faith and
creates a sense of belonging among Muslims to aid those who are in need like this group
of people.
5. “Riqab” literally means to free slaves. In the current situation, the slave system are no
longer been practice anywhere around the globe. These days, however, the interpretation
has been extended to those who are oppressed such as Muslims who are restricted from
performing their duties under the rule of non-Muslim reign.

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6. “Gharimin” known as the people who are in debt. Muslims who are in debt and have no
resources to pay their debts considered acceptable in Islam such as being in debt to get
basis amenities to sustain their lives and those under their care.
7. “Fi sabilillah” considered as fighters who fights in the cause of Allah to promote Islam
such as students and those who are in the war to protect Islamic countries from the
invasion of enemies of Islam.
8. “Ibn Sabil” are the wayfarers who run out of food ration in their travel for a good cause
(Sadeq 1991).
3.1. Current Issues
Based on the case study conducted entitled with “Enhancement of Zakat Distribution
Management System: Case Study in Malaysia” (Lubis,Yaacob, Omar et.al, 2011), stated that the
issue with zakat distribution is very crucial since it might cause dissatisfaction among the people
who pay zakat which later on might lead them to pay zakat directly to “Asnaf”, without going
through zakat institution which it will cause a lot of problems later. The issues about leak of
zakat collection and rough distribution among “Asnaf” might happen if zakat payers pay zakat
directly to “Asnaf” especially to the needy and poor people (Sanep et. al, 2006).
The arguments in term of zakat donor trusts are supported by an article entitled with “Zakat
Institution in Malaysia: Problems and Issues”written by (Abd Rahman, Haji Alias, Syed Omar
et.al,2011) stated that even though the administration of zakat has undergone many
improvements in terms of infrastructure, human capital, delivery system and governance
transparency, there are still issues that need to be tackled to ensure that the administration of
zakat is moving on the right track, henceforth to eradicate poverty and to upgrade people’s
standard of living nationally and internationally. No matter how good the system is developed, if
it could not cater to the needs of the community especially the poor and needy, such institution is
considered as inefficient. In order to empower zakat institutions in Malaysia a number of issues
need to be addressed (Mohammad et.al, (2011)).
In this paper, the issues highlighted as for E-Zakat System in Malaysia are as in term of the
inefficiency of the current Zakat System as well as the weakness of tracking the prospective
payers which caused in lack of efficiency in term of distributing the zakat contribution.

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I. Inefficiency
According to (Abd Rahman, Haji Alias, Syed Omar et.al, 2011), the issue in term of inefficiency
are highlighted and the urgency on enhancing and strengthen the zakat management system
especially in distribution aspect. In general, zakat is commonly given based on the applications
and sometimes, it is based on public report or initiatives carried out by zakat institution itself.
Certain criteria are set by the authority so that zakat is distributed to the rightful “Asnaf”.
However, there are complaints made by the public that zakat did not reach the targeted group due
to lack of publicity by the authority or lack of knowledge on the other part of the community.
Differences in opinions might also lead to the same problem, whether in ideology or different
school of law. For example, Syafie school of thought stated that zakat may not be paid in price
while Hanafi school allowed it. Those who are in favour of the first view would pay zakat in its
real form like zakat for paddy is paid in paddy. Therefore, they pay zakat not to zakat institution
as this institution seldom receives zakat in real form. In some cases zakat has been handed over
to the rightful persons but at the same time there are people who need more zakat compared to
the former. Therefore, the objective is not fully fulfilled. Apart from that, bureaucracy plays
another role where it would disrupt the process of distributing zakat. According to a research on
Malaysian students who are studying in al-Azhar University, there are bureaucracy problem that
would slow down the application for zakat. For example, the student is required to make an
application every year to Majlis Agama Islam Negeri (MAIN) in order to receive zakat although
their application has already been approved when they were in the first year (Abd Rahman, Haji
Alias, Syed Omar et.al, 2011).
For that purpose, all documents must be presented as if it is a fresh application. In certain states,
the students are obligated to acquire study loan before they are eligible to receive zakat (Azman
et al., 2012).
II. Prospective Payers
The transformation in the administration of zakat could be done by improving the ability of zakat
collection centres to identify not only those who should pay zakat, but also to trace down the
prospective zakat payers. According to a report made by Pusat Pungutan Zakat (PPZ) and Majlis
Agama Islam Wilayah Persekutuan (MAIWP) in 2010 shows that although the number of

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Muslims who live in Selangor is approximately 2 million, the number of zakat payers is only
around 160,000. For this purpose, the authority needs to change the method of collecting zakat
from waiting at the counters to proactively organising briefing sessions on the importance of
zakat to students, to public and private sector workers, and to police and soldiers in training. This
initiative may raise awareness among prospective payers to fulfil their religious obligations in
the future. (Abd Rahman, Haji Alias, Syed Omar et.al, 2011).
3.2. Similar Works Conducted
In this paper, in order to ensure that “trust” element implemented in E-Zakat System, similar
research, articles and journal has been referred act as a guideline and justification. The details are
as follows:
I. Zakat Expert System.
II. Heartfile Health Financing (HHF).
3.3. Solutions in Providing Trust in E-Zakat System
In E-Zakat System context, it is crucial to the system developers as well as system analysts to
ensure the element of trust is present in a system being developed. Zakat is considered as a
transaction that deals with properties and liabilities as the transaction needs to be efficient and
secured in a trustful environment. Proper information as well as the ease of use needs to be
considered in providing trust between the user and the system they interacted. The solutions
provided are gathered from the literature review as it is used a primary sources of information in
this paper. The solutions are briefly described as follows:
I. Enhancing current zakat calculation function using “Zakat Expert System”.
It is not a new issue when it is involves in zakat calculation, but there is no existing Zakat Expert
System (ZES) or any system that is similar to it. However, there are a lot of information can be
found in term of zakat which has been addressed often on many websites. One of the examples is
The Hidaya Foundation known as a non‐profit organization providing education and charity that
offers zakat calculation on its website.

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The calculation of zakat is calculated by prompting the user to enter the amount of several zakat
variables such are gold, silver, and cash on hand, as well as savings accounts in terms of United
States (US) dollar amounts. There is another website providing zakat calculation service is
known as Zakat Calculator, developed by PennyAppeal.org. The major process of zakat
calculation remain the same as for this site where the user also enters the value of gold, silver,
cash, assets, as well as their liabilities in terms of British Pound amounts.
All of the mentioned websites can be considered as great sources in facilitating zakat calculation,
but ZES offers more distinguished unique features as compared to the other websites. The main
aim on building a ZES is to capture the human expertise in their specific domain on a rules‐based
expert system. The reasoning process and the explanation facilities provided by the expert‐
system shell technology are great benefit to users (Becerra‐Fernandez et al, 2004; Marakas,
2003). Such an explanation tool can improve people’s trust in using the system and in
understanding the reasoning process for each question, identified advice, and Zakat calculation.
Expert Systems (ES) are intelligent computer software that in which the specialists’ knowledge
is gathered as a set of scientific data; they not only possess information but also an argument that
includes logical thought and uses searches (algorithms) to perform the logical inferences (Alvani,
2006). An expert system, as a subset of artificial intelligence, tries to mimic human behavior and
emulate solving problems and giving solutions (Yazdi et al., 2010).
II. Reporting, transparency and traceability.
One of the main key functionalities of the current E-Zakat Systems available in Malaysia is that
the systems are lacked in term of reporting to the zakat donor. After zakat has been paid by the
donor, the process considered as complete without any further updates provided by the agencies
or the systems. These updates can be consisting of reporting on how the distribution are been
distributed and when the distribution has reached the “Asnaf”. The reports is essential to
highlight the element of transparency of a system as well as in building trust between zakat
donor, the agencies and zakat systems as well as the “Asnaf”. In addition, the zakat donor must
be able to keep in track with their donation as to ensure whether the contribution has been
distributed to the rightful “Asnaf”.

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A report has been conducted by Chloe Stirk in 2015, and he managed to produce a report entitled
with “An Act of Faith Humanitarian Financing and Zakat” stated that transparency in
development and humanitarian financial flows is an essential enabler of effective response.
It helps to build trust between donor and recipient communities and is one of the necessary
conditions for accountability to stakeholders. Understanding what resources are being directed to
whom also facilitates donors as well as the appointed agencies to target their resources in an
appropriate, complementary and coordinated manner.
Development and humanitarian actors are therefore under increasing pressure to operate
transparently when it comes to their finances. However, due to the myriad ways in which zakat
may be collected and distributed both at a global and at national level it is not subject to any
systematic form of financial reporting. In addition, zakat is also intended to be given and
received privately, so as to preserve the dignity of the person paying it. This limits its
transparency as a financial resource flow and its traceability, in terms of understanding who
benefits and how it is spent.
A paper entitled with “Protecting the poor against health impoverishment in Pakistan: proof of
concept of the potential within innovative web and mobile phone technologies” by Nishtar
(2010) has been referred strengthen the facts that one of the unique features should be available
in a system intending to reduce poverty as in the paper the author referred to a system known as
Heartfile Health Financing (HHF) implemented in Pakistan. One of the unique features is that
the system must be able send an automated alerts or notifications to a relevant user via Short
Message System (SMS) or by email in case of delay in which the request processing is
monitored at frequent intervals.

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The explanations in terms of reporting, transparency, and traceability are described as in the table
1 below:
REQUEST PROCESSING INNOVATIONS
Details Descriptions
Automated workflow with parallel tasks for various
system users ensures rapid and timely response.
Quick processing obviates delays. Patient or family
does not have to make follow up visits, bears no
additional costs of travel, and doesn’t make
informal payments or loose working days. Health
providers receive early decisions, stay updated on
the request processing cycle, and do not waste time
in lengthy file work.
A bi-directional interface with SMS technology
through which SMS messages can be received and
sent to users.
The system enables more than 90 million cell
phone owners in Pakistan to use this system.
Hierarchal management of tasks and records for
organizational users: Ability to automatically
generate messages required for processing requests
at every stage and sends them to relevant users.
Organizational as well individual users are kept
current on the processing of their donations.
Ability to send an automated alert to a relevant user
via SMS or email in case of delay.
Request processing is monitored at frequent
intervals.
Table 1: Heartfile Health Financing: Unique Features of the Technology Platform and Health
While the explanations in terms of transparency and traceability is described as in the table 2
below:
INNOVATIONS IN DONATION MANAGEMENT AND TRANSPARENCY
Details Descriptions
Visibility
i. A real time viewing of fund utilisation
detail at a micro transaction level
Capacity to update donors on a micro transaction
basis is an innovation unprecedented by
international standards.
ii. Ability to view administrative cost of
managing each disbursement and the
percentage of funds utilized for
administrative overheads.
Highest possible level of transparency is ensured so
that funds are utilized as per the criteria defined by
the donor.

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Donor empowerment: donors have the ability to
control donations via selection of recipient criteria.
Scope can be extended depending upon donor
feedback or emerging situations without a need for
any structural changes in the software. Can also
limit the amount of a specific donation or request a
preapproval for larger amounts case by case.
Measures to empower the donor are unique by
international standards.
Feedback on poorly performing recipient selection
criteria to encourage donor to change their
preference that are more suitable to the population
served by the system.
This and the previous two attributes of the system
are a step towards strategically enhancing the base
of the Health Equity Fund over time.
Respect for choice: Depending upon donor’s
preferences funds or portion of funds is placed in
various virtual pools. Each pool is dynamically
managed depending upon the inflow and outflow of
the funds.
This complex but innovative logic enables
donations to be spread to a larger number of
recipients as majority of recipients would qualify
funds allocation from more than one pool. The
approach ensures that minimal numbers of
applicants are rejected while at the same time
ensuring respect for donor’s preferences.
Scheduling, reminding and tracking of all pledges. Automated reminders are sent to potential donors
thus reminding them of pledges made.
Table 2: Heartfile Health Financing: Unique Features of the Technology Platform and Health

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3.4. Use Case Diagram
In this paper, the solution proposed in order to enhance the functionalities of current E-Zakat
System available in Malaysia by providing the trust element for the zakat donor are represented
in term of use case diagram. The use case diagram used as a model illustrating the process of
trusted E-Zakat System. The flows are as follows:
Enhanced Functionalities of E-Zakat System Descriptions
I. Registration of User (Zakat Donor) In this process, user needs to register
their details before they can log in to
the system.
Once the registration process is
complete, the system will authenticate
the user details. User may log in and
use the system as soon as the
notifications had been sent to the user.
II. User Insert Payment and Calculate the Zakat
Amount Using Zakat Expert System
The system prompts the user to input
information, and according to the
information the system reaches a
conclusion or an output. Based on the
knowledge acquisition process,
different types of inputs are needed
for different types of Zakat. The first
question of this developed system is
to ask: What kind of Zakat would you
like to calculate? Then, based on the
selected zakat types, the system asks
the related questions. According to the
user’s answers, the Zakat ES system
displays descriptions and the amounts
required for the different types of
zakat.

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III. Zakat Payment Transaction Once the user completes the
calculation process, user needs to
accept the zakat system terms and
condition before they can proceed
with their payment. User then
proceeds with the zakat amount to be
contributed. Systems then gene rates
payment details delivered to the user
and the payment transaction
completed. If the user did not agree
the term and conditions, the process
ends.
IV. System Generates Reporting Alerting the User to
Keep Track the Contribution
The reports are then generated by the
system to users providing alert
systems regarding the status of their
contribution by SMS and emails.
This process occurs when the
contribution has been distributed
accordingly to the entrusted “Asnaf”.
The user are also able to keep in
tracks with their contribution as well
in order the information are updated
and the contribution are trustfully
channelled to the rightful “Asnaf”.
Table 3: The Process of Enhanced E-Zakat System by Adding "Trust" Elements

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3.5. Technology Centred Vs Human Centred
The relationship between Technology and Human Centred are briefly described as stated in
the table below. These relationships are interrelated as to find the mutual features between
the comparisons that leads to the addition of trust element of E-Zakat System.
Technological Perspective Human Perspective
I. Mobility
User should be able to access the system
using any devices such are mobile phone,
web based, as well as through computers.
I. Privacy
The system must be able to keep the details
of the user or known as the zakat donor
secured without any misused.
II. Usability
The information must be provided
sufficiently by the system to ensure the
ease of use of the system can be achieved.
In this case, the information regarding the
zakat types and calculation should facilitate
the user in making the zakat donations.
II. Social Impact
The main objective of zakat in term of
social perspective is to resolve poverty
issues. Zakat also aims to establish social
justice as well as to develop a society based
on love, mutual solidarity, and
brotherhood. In addition intends to purge
from the poor feelings of hatred and
animosity that they might have for the rich.
III. Reporting, Transparency, and
Traceability
The user must be able to keep in track with
what they have contributed through the
system. The system must be able to provide
good information and must be responsive.
III. Economic Impact
Zakat is beneficial in sustaining and
maintaining the growth of the economy as
well as to maintain the social hierarchy
without any monopoly.
Table 4: Relationship of Technology and Human Centred in Providing Trust Element

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3.6. Benefits, Challenges, and Limitations
The benefits of the research, challenges and limitation are describe as in the following tbale
below:
Benefits Challenges Limitations
I. User Trust. I. Integrating all Zakat
institution available in
each state in Malaysia.
I. The prototype is not
developed in the
research.
II. Encouraged people to
pay zakat by using
trusted system.
II. Reachability of user that
has knowledge on using
system.
II. The solutions only
represented in term of
flows and processes.
III. Improving current zakat
payment process and
flows in Malaysia.
III. The stability of a system
to maintain and keep
updated with the zakat
donor.
III. Difficulties on finding
developer to developed
the system.
Table 5: Benefits, Challenges and Limitation
3.7. Future Use
As for future use, the research is intended on helping and act as a model on guiding any other
researcher or developer to developed the proposed solution into a system.
4. Conclusion
As for conclusion, it can be conclude that zakat plays major role on sustaining and maintaining
the equality in term of living style especially for Muslim community. As in the context of the
research, trust element must be present in E- Zakat System in improving the functionalities of a
current E-Zakat System. Trust is important in zakat transaction as it is considered obligatory
from Allah as well as “Ibadah” for Muslims. This will ensure that there is no doubt or known as
“Syubhah” occurs during the transaction of zakat.
Having alerting system applied in E-Zakat System will improve the functionality of current E-
Zakat System available as the system will improve in term of reporting, transparency and the
transparency of the system. Zakat donor can manage, keep in track with their donations until
their contribution has been distributed accordingly to the rightful “Asnaf”.

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5. References
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Stark.C, (2015), An Act of Faith: Humanitarian Financing and Zakat
Al-Riyami, A., Al-Amri, A. A. H. K., & Al-Busaidi, K. A. (2014). Zakat Expert System. Volume
One, 31.
Ab Rahman, A., Alias, M., & Syed Omar, S. M. N. (2012). Zakat institution in Malaysia:
Problems and issues. Global Journal of Al-Thalaqah, 2, 35-42.
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Protecting the poor against health impoverishment in Pakistan: Proof of concept of the potential
within innovative web and mobile phone technologies. World health report, 55.
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