Zakat for generating sustainable income: an emerging mechanism of productive distribution

Zakat can be allocated to help the poor establish a sustainable income. Recipients may receive zakat assistance in the form of both capital and job equipment, coupled with suitable training. Traditionally, zakat distribution has adhered to classical principles, involving monthly financial aid or limited working capital. However, this method is perceived as less effective in eradicating poverty. This study emphasises the significance of directing zakat towards income generation as a more impactful approach to poverty alleviation. To this end, this study explores classical and modern models of zakat disbursements for income generation, drawing from scholars’ perspectives in their respective eras. A qualitative approach for data collection and analysis was adopted based on the evidence from classical and modern literature. There are several methods of zakat disbursement for income generation, namely capital grants, loans, and training. Based on a survey of classical and modern literature, it was found that some classical scholars have granted such disbursements. Recognising the efficacy of this approach in helping zakat recipients, modern scholars are inclined to support income generation programs, including zakat loan provision. The evolution of this concept, coupled with its successful implementation, positions zakat as a key player in eradicating poverty among Muslims globally.