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Thursday, 25 April 2019

UNHCR unveils the Refugee Zakat Fund, a global Islamic finance structure to help displaced populations worldwide

25 April 2019 (UNHCR)

Dubai, United Arab Emirates, April 25, 2019. The Muslim world has the potential to transform philanthropy through strategic targeting of tens of billions of dollars of obligatory alms, the United Nations High Commissioner for Refugees announced at an event attended by officials, ambassadors and specialists, to launch its Refugee Zakat Fund, a new global structure that transforms UNHCR’s existing Zakat program into a global fund aimed at aiding the most vulnerable displaced populations while meeting the needs of Islamic institutions as well as individuals in fulfilling their social responsibility.

UNHCR unveiled its “UNHCR Zakat Program: 2019 Launch Report”, developed in partnership with DinarStandard, a growth strategy research and advisory firm and the co-authors of the report, during the Refugee Zakat Fund launch today. The report indicates that UNHCR’s Zakat program globally received US$14.4 million from 2016 to 2018, directly assisting 6,888 displaced families, primarily Syrian refugees in Jordan and Lebanon. In addition, the report shows that the global Zakat giving stands at US$76 billion worldwide, and could potentially reach an amount as high as US$ 356 billion, if proper mechanisms are in place for Muslims to safely fulfill their Zakat obligations.

Zakat is the mandatory alms given by Muslims who meet the necessary criteria of wealth each year, particularly to the needy. UNHCR has pioneered the leveraging of Zakat and established its Zakat program to aid the most vulnerable displaced families. The decision to restructure the Zakat program into the global Refugee Zakat Fund is due to the high donor turnout UNHCR has witnessed in the past years.

The Fund allows individuals and institutions alike to fulfil their Zakat obligations efficiently through a globally trusted structure, governed by UNHCR, with 100% of contributions delivered directly to the most vulnerable refugees and internally displaced families. It is fully Sharia-compliant; backed by fatwas from leading Islamic scholars and institutions, and subject to strict governance, ensuring utmost transparency. UNHCR aims to bridge its required funding of US$208.6 million for some 154,740 of the most vulnerable displaced families.

“Over the past few years, UNHCR has seen the demand for a trusted and efficient way of fulfilling Zakat obligations, while making an impact on the lives of some of the most vulnerable populations in the world,” said Houssam Chahine, UNHCR’s Head of Private Sector Partnerships in the MENA region. “With Islamic finance becoming a prominent part of the global economy, we are launching our first annual Zakat report today on the occasion of the Year of Tolerance from Dubai, the capital of Islamic economy. It was inevitable for our Zakat program to evolve into a structure that better appeals to the global Islamic finance industry. The Fund allows UNHCR to be even more transparent and trusted in how it receives and distributes Zakat funds.” he added. 

“Zakat has the potential to release tens of billions of dollars into global philanthropic causes and humanitarian needs, inaugural UNHCR report reveals”, said Rafi-uddin Shikoh, CEO and Managing Director at DinarStandard. “Muslim obligatory charitable contributions might be just the solution to address UNHCR’s funding gap given that 60% out of the 68.5 million of forcibly displaced people worldwide (around 40.8 million people) are Zakat-eligible.” he added.

While the Fund was unveiled just before the Holy Month of Ramadan, traditionally a month of giving and charity for Muslims around the world, UNHCR’s Chahine was keen to emphasize that Zakat obligations can also be fulfilled all year round. “Ramadan is an important time for refugees, and this year we are launching a major campaign globally to encourage Muslims to remember refugees in their prayers, and remember them with their Zakat. However, the Refugee Zakat Fund accepts contributions all year round, helping individuals, institutions and businesses align their philanthropic Zakat with statutory finance requirements and their own calendars.”

The budget required by UNHCR in 2019 is US$7.9 billion, to respond to the overall needs of refugees and internally displaced and other people of concern around the world.

For more information about the Refugee Zakat Fund, click on the following link: zakat(dot)unhcr(dot)org.

25 April 2019 (UNHCR)

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