Generic system dynamics model of zakat collection and microtakaful contribution for poor and needy asnaf category

Zakat, as one of the important Islamic financial instruments, has the potential to provide financial protection as known as microtakaful especially to the group of Asnaf. However, this protection requires a new commitment of contribution which will affect the current practice of distributing the zakat fund. This paper aims to simulate the cash flow of the zakat fund and to visualize the impact of microtakaful contribution using the system dynamics model approach. The results from this model can be used as an initial strategy in implementing microtakaful from the zakat fund. One of the important results is that this microtakaful contribution will affect the cash flow allocated for asnaf development program and hence, will affect the rate of asnaf to be economically independent. It is recommended that this model be enhanced with more target objectives of the zakat fund.