Utilizing Cash Waqf for
Funding High Education
Through Bank And Corporate
Hafiz Benraheem G1625621
Atharyanshah Puneri G1715491
Moussa Traore G1711587
Muad’z Abdul Wahab G1714611
Objective of study
• To explore the potential of cash Waqf for funding the higher
education.
WAQF: CONCEPT AND definition
Waqf is an Arabic word, literally means “habs” “locking up”, detention,
confinement and prohibition or causing a thing to stop or stand still (Hassan
Definition of Hanbali Juristic School “keeping a capital and consecrate returns”.
We prefer this definition because:
1. Was quoted from the speech of the Prophet “peace be upon him” to Umar
Ibn Al Khattab “may Allah be pleased with him): “If you wish you can keep it
as an endowment to be used for charitable purposes”.
2. Is one of the most abbreviated and clearest definitions of waqf conception.
3. Has not been objected to more criticism like the rest of the other
definitions.
Significant of waqf for economic development ( Budiman 2014)
The categories of waqf in Islamic jurisprudence
How to apply the Waqf in developing
higher education
Waqf and endowment fund developing
higher education.
Waqaf in Education Concept
• In the past, waqf is utilized only for religious purposes such as for
building mosques, orphanages and also for burial matters.
• Nowadays, The waqf concept has been utilized to meet various
purposes including housing, poverty alleviation, financing and also
for education, taking care of animals, agriculture, , and watering
resources (Mahamood & Ab Rahman, 2015)
• The role of waqf to finance the education system begins few
decades ago both in the Muslim and non-Muslim countries.
• Education has been financed by voluntary contributions since the
beginning of Islam. Even governments have been financing
education by constructing schools and assigning certain property as
Waqf of the schools.
• Al Azhar University of Egypt is one of the oldest and a major awqaf
supported seat of Islamic teaching and research and higher
education.
Waqf Through Bank
Cash Waqf Through Bank
• Nowdays, people are using banks, especially an Islamic
bank, as an agent to collect and utilize cash waqf is a
common practice in several Muslim countries.
• Waqf Bank is intended to mean as one that is an interest
free, not-for-profit, and social bank the capital of which
is dedicated mainly to social welfare, provision of
microfinancing and economic development of the poor
and under privileged.
Cash Waqf Through Bank scheme in
Bangladesh (Social Investment Bank
Bangladesh and Islamic Bank
Bangladesh)
Investment Cash-Waqf Charity
Depositor Bank Capital
Earnings Account Projects
Cash Waqf through Bank in Malaysia
(PWS and Muamalat Malaysia Berhad)
Cash Waqf through Bank in
Indonesia
Cash Waqf Income in Indonesia
2007 2008 2009 2010 2011 total
BNI Syariah Rp 10,000,000 Rp 11,113,000 Rp 19,200,000 Rp Rp 69,390,000 Rp
290,434,450 400,137,450
Bank Syariah Rp Rp Rp Rp Rp
Mandiri 19,000,000 422,766,141 927,806,732 573,337,268 1,942,910,141
Bank Rp 7,000,000 Rp 96,100,621 Rp 76,572,493 Rp
Muamalat 179,673,113
Bank DKI Rp 5,350,000 Rp Rp Rp
Syariah 185,154,300 26,545,582 217,049,882
Bank Mega Rp 9,108,000 Rp Rp 42,968,425 Rp
Syariah 173,496,865 225,573,290
Bank Syariah Rp 1,000,000 Rp 5,050,000 Rp 6,050,000
Bukopin
Bank BTN Rp 2,000,000 Rp 2,000,000
Syariah
Total Rp 10,000,000 Rp 30,113,000 Rp Rp Rp Rp
463,424,141 1,673,992,968 795,863,768 2,973,393,876
Corporate Waqf
The Definition Of Corporate Waqf
• The confinement of an amount of liquid money, shares, profit,
dividends by founder(s) such as individuals, companies,
corpora-tions, organizations or institutions, and the dedication
of its usufruct in perpetuity to the welfare of society.
(Thaker and Thaker 2015)
Principles And Objectives Of Corporate
Waqf
• To create an Islamic institution catering to the society’s need
with element of corporate entity
• To carry out the responsibility to the ‘ummah’ for eternity
• To voluntarily share wealth, time and expertise
• To generate wealth and protection of the income and
• To establish an incorporation instrument that is trustworthy and
wholly
(Ramli and Muhamed 2013)
An Example of Corporate Waqf
Models
• Johor Corporation Berhad
JCorp declared some amount of shares of its subsidiaries as
Waqf to Waqf An-Nur Corporation Berhad* (one of the subsidiary
company)
*Waqf An-Nur Corporation Berhad (WANCorp) is a Limited
company established to guarantee proper management of Johor
Corporation and its Group of Companies stock and asset under
endowment. WANCorp serves as ‘Maukuf Alaihi’ to stock and
other form of the company’s security that has been put under
endowment as a whole.
List of J Corp Companies Waqf Shares
Contribution
Share Waqf of Listed Companies
Shares Description
KPJ Health Care 7.2% or equivalent to 69.73millions of
shares outstanding 3.85%
Kulim Malaysia Berhad 0.38% or equivalent to 12.62 millions
of shares outstanding
Al –‘Aqar Healthcare REIT 9.98% or equivalent to 44.51 millions
of shares outstanding
Share Waqf of Non-Listed Companies
Shares Description
Tiram Travel Sdn. Bhd. 75% or equivalent to 750,000 shares
outstanding
LarkinSentral Property Bhd. 61% or equivalent to 50.33 million
shares outstanding.
Capaian Aspirasi Sdn. Bhd. 75% or equivalent to 75,000 shares
outstanding.
Source:(“WANCorp Annual Report 2017.Pdf” 2017)
Diagram from JCorp’s corporate
share Waqf model Waqf
Issues
• 1. Default payment by the borrowing grass-roots who may fail to
return the amount lent to them.
• 2. Potential moral hazard by some managers (mutawalli) of the
cash Waqf.
• 3. Lack of resilience in many Muslim economies where the cash
Waqf predominantly operates
Conclusions & Recommendation
• From the study above, there is huge potential that we can utilize
the cash Waqf for funding higher education. There are two
scheme which are through bank and corporation models as
followed:
Cash Waqf Through Bank scheme to
funding for Higher Education
The Structure of Corporate Waqf
University Model
