Volume 29, Issue 3
DOI: 10.24205/03276716.2020.777
Impact of zakat payment trends on the community development in Indonesia: Mediating role of supply chain awareness system
Abstract
Among the Muslim communities, zakat management is accepted as a significant instrument for social and financial development. It is also accepted as a major economic source for the Islamic countries. To improve the social wellbeing of the community members, it is essential to optimally utilize the zakat payments. This study aims to investigate the impact of zakat payment trends on community development with the mediating effect information supply chain awareness system (SCAS) in Indonesia. For targeting this objective, three conceptual frameworks are developed and empirically tested. A sample of 182 respondents from the different officials who are directly or indirectly associated with the zakat collection in the Indonesian region is collected through questionnaire design. Zakat payment trends are measured through five queries, and overall community development is examined through ten factors which include orphan scholarship, financial assistance to poor and vulnerable families, food packages, medical treatment, insurance and subsidies, emergency assistance, the Contribution for the disaster management, overall community development, petty cash to travellers, zakat business loans, and financial assistance towards education. Findings of the study show that positive and significant impact on orphan scholars and financial assistance to the poor is observed as a local community feel it as a social and moral obligation to pay for the zakat—besides, some limitations as also associated with present research. For instance, a study sample is found to be not good enough as it is below than 200. Future studies should address these limitations for covering the literature gap in a more reasonable way.
Keywords
Zakat payment trends, Community development, Supply chain awareness system, Indonesia