The United Nations’ refugee agency has unveiled plans for a global rollout of its zakat fund as it seeks to better leverage Islamic giving to support its relief work and plug funding gaps.
UNHCR will also expand its Islamic fundraising with a legacy scheme for donors, and is exploring the creation of an Islamic charitable endowment, or waqf, to support the refugee cause.
“With Islamic philanthropy, we are only scratching the surface,” said Khaled Khalifa, UNHCR’s regional representative to GCC countries and senior adviser for Islamic philanthropy. “I strongly believe that Islamic philanthropy can respond to most of the humanitarian needs around the world. We know there are tens of billions of dollars that are circulating in zakat alone – outside of waqf and sukuk [sharia-compliant bonds].”
The UNHCR Refugee Zakat Fund launched in 2019 as an online platform designed to enable Muslims to donate their alms for relief work. Zakat, a pillar of Islam, requires Muslims worldwide to give typically 2.5 per cent of their wealth each year for the benefit of the poor.
The fund, which is supported by Muslim clerics in Egypt, Morocco, Saudi Arabia and elsewhere, raised $61.5m in 2020 in support of UNHCR’s work with refugees and displaced people.
The majority of donations were sourced from the Middle East and North Africa, and came overwhelmingly from philanthropists and institutional partners. Less than a fifth of zakat and sadaqah (voluntary charity) donations came through the digital platform, which was supplemented by the launch of a mobile app in December.
The single largest donation came from Qatar’s Sheikh Thani bin Abdullah bin Thani Al-Thani, who gifted some $43m to fund UNCHR’s aid work in Yemen, Lebanon, Bangladesh and Chad.
The agency will this year ramp up its engagement with Islamic philanthropy stakeholders in Asia, Africa, North America and Australia in a bid to widen its donor base and guard against any pandemic-linked decline in giving.
“There is a risk that countries and donors will focus internally and this is something that we are afraid of,” said Khalifa. “NGOs and UN organisations around the world are trying to become more innovative and to rely more on private sources.”
UNCHR hopes to reach $1bn in donations through its zakat fund in the coming years, Khalifa said.
“We are also trying to explore other initiatives whereby countries assist themselves. We are working with one of the largest zakat institutions in Nigeria to optimise their collection process and help Nigerian donors.”
UNCHR said it will launch a legacy-giving programme in 2021 for donors willing to leave a portion of the wealth and assets in their will to benefit refugees and displaced people. Separately, the agency is in talks with an unnamed development institution to explore the establishment of a cash waqf, or Islamic charitable endowment. The seed capital raised would be invested to generate profits that would be used to fund UNCHR’s work.
In 2020, money donated through the zakat fund reached 2.1 million refugees and internally displaced people in 13 countries, distributed in the form of cash assistance and goods. More than 641,400 beneficiaries were in Yemen, where levels of hunger are at a record high, brought on by six years of civil war.
Lifesaving assistance was also given to more than 580,000 Rohingya refugees in Bangladesh and India, a minority group who fled violence in Myanmar, in addition to Syrian refugees living in Jordan, Lebanon and Egypt.
UNHCR has projected it will need $9.1bn this year to meet the growing needs of the 79.5 million people around the world forced from their homes by violence, hunger and economic upheaval.
Around $2.7bn of this is needed in countries where the agency can distribute zakat, including Jordan, Pakistan, Yemen, India and Iraq.
Referring to the fund, Khalifa said: “We hope in the future we will be talking about hundreds of millions of dollars [and] to speak about hundreds of partners, because the refugees who need assistance are in the tens of millions. If we don’t seek new partnerships and innovations, I don’t think we’ll meet the demand.” — PA