Zakat means “that which purifies”. Zakat is a mandatory process for Muslims and is regarded as a form of worship. Giving away money to the poor is said to purify yearly earnings that are over and above what is required to provide the essential needs of a person or family.
As one of the Five Pillars of Islam, zakat is a religious duty for all Muslims who meet the necessary criteria of wealth to help the needy. It is a mandatory charitable contribution, often considered to be a tax. It is a form of almsgiving, which, by Quranic ranking, is next after prayer (salat) in importance.
Zakat is an assigned amount that is worth 2.5% of wealth which is to be paid to the community. The community is then to use the Zakat contributions to support the less privileged. Traditionally it is distributed to the poor – those living without means of livelihood (Al-Fuqarā’) and the needy – those who cannot meet their basic needs (Al-Masākīn).
Zakat is considered by Muslims to be an act of piety through which one expresses concern for the well-being of people who needs it, as well as preserving social harmony between the wealthy and the poor. Zakat promotes a more equitable redistribution of wealth and fosters a sense of solidarity amongst members of the people.
Study shows that widespread poverty still persists in the Islamic world despite zakat collections every year. Over 70% of the Muslim population in most Muslim countries is impoverished and lives on less than US$2 per day. In over 10 Muslim-majority countries, over 50% of the population lived on less than $1.25 per day income. Zakat has so far failed to relieve large-scale absolute poverty among Muslims in most Muslim countries.
An important part of iHalalCoin.org’s story will be written from a charitable approach, which is our core focus. iHC has built-in zakat deduction which would donate 2.5% to charity. It is in our hearts, and together with our investors, we want to combine the financial benefits that everyone can achieve with an attitude of love, care, and compassion.
This is possible as blockchain has created a whole new world that liberates finance, especially for those who would never get such an opportunity in today’s centralized financial system. At the same time, it is important to consider that is it transcendental for us humans to be in balance; otherwise, we lose a part of our humanity; financial solvency without a loving and caring heart for our fellow human beings is hollow, empty cold and hard.
We believe that in order to receive, we must first learn to give. The act of giving involves the willingness to turn our gaze to our fellow man, those who are in need, those who lead lives that can opposite of our own. Together, me and you, small or large; the cents or the millions, it’s all valuable. We can and will make a real difference in countless lives, the very core that creates our society.
