Islamic Wealth Management
Show Less

Islamic Wealth Management

Theory and Practice

Edited by Mohamed Ariff and Shamsher Mohamad

From an Islamic perspective, although the ownership of wealth is with God, humans are gifted with wealth to manage it with the objective of benefiting the human society. Such guidance means that wealth management is a process involving the accumulation, generation, purification, preservation and distribution of wealth, all to be conducted carefully in permissible ways. This book is the first to lay out a coherent framework on how wealth management should be conducted in compliance with guiding principles from edicts of a major world religion.
Show Summary Details
You do not have access to this content

Chapter 20: Zakat in Islamic wealth management

Ziyaad Mahomed


A significant distinction between mainstream and Islamic wealth management is the latter’s planning for zakat, an obligatory charity on the faithful with wealth in excess of needs above a specific threshold. This chapter reviews the concept of zakat, its levying structure, its rules and objectives and the economic impact of its distribution. Furthermore, we consider in brief the evolution of this institutions with its clearly defined principles. There are also challenges: there is no consensus on levying zakat on businesses since individuals could hoard wealth in firms (as do non-dividend paying firms) and most ministries consider it an obligation on individual shareholders, apart from the business. Challenges also exist in the effective distribution to eligible recipients. Without efficient disbursement, the responsibility may continue to burden the zakat-payer as a compulsory duty. Unless the challenges are overcome, the wealth effects of zakat may not achieve the desired objective of poverty-reduction and socio-economic empowerment.

You are not authenticated to view the full text of this chapter or article.

Elgaronline requires a subscription or purchase to access the full text of books or journals. Please login through your library system or with your personal username and password on the homepage.

Non-subscribers can freely search the site, view abstracts/ extracts and download selected front matter and introductory chapters for personal use.

Your library may not have purchased all subject areas. If you are authenticated and think you should have access to this title, please contact your librarian.

Further information

or login to access all content.