The mechanism for managing zakat, infaq, and sadaqah funds in Islamic Banks as an implementation of the social function of banks

Abstract

The background to this research is that zakat is very important in life and development. Zakat is an obligation of Muslims. Every Muslim will pay zakat because it is an obligation. So, the potential for receiving zakat funds will be very large. With such large funds. Zakat Management Institutions play a very significant role in people's lives. The aim of the research is to determine the mechanism for managing zakat, infaq and shadaqah funds in sharia banks as an implementation of the bank's social functions. The method in this research uses field research using descriptive qualitative methods, using observation, interview, and documentation techniques. The research results show that Zakat Funds and Virtue Funds are recorded as entrusted funds until the funds are handed over to the channeling institution or mustahiq. With its status as a deposit fund before the funds are used it will increase the sharia bank's assets. ZIS fund management is focused on collection and distribution. ZIS funds collected at the Bank come from banks/companies, zakat funds from outside the bank (including zakat customers), employees and administrators. Distribution of zakat is channeled through banks or through other institutions that adhere to a productive and consumptive system. Compensation, namely consumer compensation, is received directly by mustahik for their needs, while obtaining compensation is carried out through a venture capital program.