A Blockchain based Decentralized Zakat Collection and Distribution Platform

Abstract

Zakat is one of the five mandatory pillars of Islam. It plays a vital role in addressing the social issues such as wealth inequality and supporting the less fortunate. Any Muslim whose wealth and assets exceeds the Nisab value must pay zakat. However, unlike taxes, zakat is not collected by government or authorities. Therefore, every eligible individual is responsible for its calculation and distribution independently. Hence, there are several issues and challenges associated with its collection and distribution, especially in non-Islamic countries. This research paper proposes a blockchain-based online platform for zakat collection and distribution, addressing these challenges. Blockchain can help to ensure that zakat funds are distributed to beneficiaries in an efficient manner. The system allows zakat payers to select and allocate funds to the verified beneficiaries while ensuring Sharia compliance. The proposed system uses a blockchain ledger to enhances transparency, and accountability. It minimizes the associated collection and distribution costs by removing intermediaries. This research aims to contribute to the efficient and secure management of zakat funds, promoting social justice, and responsible zakat practices in the Muslim community.