Zakat collection agency MZK sets 12th initiative on wakalah-based management reforms

KUALA LUMPUR, 19 AUGUST 2026 —

Malaysia to Review Zakat Management via Nationwide Symposium Focused on Wakalah Model

The symposium, organized by the Institute of Fatwa and Halal (iFFAH) at Universiti Sains Islam Malaysia (USIM) in collaboration with the Department of Waqf, Zakat and Haj (JAWHAR) and the Zakat and Endowment Council of Malaysian Higher Education Institutions (MAWEZ), aims to address critical gaps in zakat distribution under the wakalah framework. Dato’ Mohd Zaidi bin Ramli, Director-General of JAWHAR, highlighted concerns over inconsistent agency rates across states, overlapping zakat recipients, and the lack of standardized reporting mechanisms for funds entrusted to appointed agents.

“Under the wakalah concept, state Islamic councils are supposed to distribute zakat but instead delegate this responsibility to companies or individuals,” he said. “This necessitates a unified reporting guideline to ensure transparency and prevent duplication in distribution.” He added that the symposium seeks to develop a Shariah-compliant manual for zakat agency management to guide state Islamic councils nationwide.

Prof. Dr. Azman Ab Rahman, Director of iFFAH USIM, emphasized the need for stronger governance in implementing the wakalah model to bolster public trust in zakat institutions. While acknowledging that the model has boosted zakat collection in Malaysia, he stressed the importance of meticulous oversight to maximize benefits for asnaf (zakat recipients). “The wakalah approach has undeniably increased collections, but we must scrutinize its governance to ensure it delivers tangible benefits to those in need,” he said.

Both leaders underscored the role of digital technology, data analytics, and artificial intelligence in modernizing zakat management—provided these tools align with Shariah principles, integrity, and accountability. The event also saw the launch of the Zakat Amil Management Module for Malaysia and Brunei Darussalam, a reference guide for zakat collectors in both countries.

Malaysia’s zakat system has evolved from traditional state-managed models to include private sector participation through the wakalah mechanism, which allows agencies to collect and distribute funds on behalf of state Islamic councils. However, inconsistencies in agency fees, monitoring of disbursements, and reporting standards have raised concerns about efficiency and fairness. The symposium’s outcomes are expected to shape future policies to standardize practices and enhance the socio-economic impact of zakat.

Industry observers note that the growing adoption of digital platforms in zakat collection—such as e-wallets and mobile apps—has expanded reach but also introduced new compliance challenges. The integration of AI for identifying eligible recipients and fraud detection is being explored, though implementation remains subject to Shariah approval. With zakat collection in Malaysia exceeding RM1 billion annually, ensuring governance under the wakalah model is critical to maintaining public confidence and maximizing social welfare impact.

The MZK’s deliberations come amid broader efforts to modernize Islamic finance in Malaysia, positioning the country as a regional hub for Shariah-compliant financial services. Outcomes from the symposium, including potential regulatory recommendations, are expected to be announced by the end of the event.