KUALA LUMPUR, 6 SEPTEMBER 2023: Maybank Islamic Berhad and Lembaga Zakat Selangor recently inked a collaborative agreement to ensure customers can effortlessly complete their Zakat obligations while at the same time empowering them to make a significant positive social impact through their donations.

The agreement, which formalised the appointment of Maybank Islamic as the main operational bank for LZS, is envisaged to boost contributions to poverty alleviation programmes, with the Bank amplifying these efforts through its online channels.

“Zakat not only contributes to poverty alleviation but also improves prosperity within a community. With this partnership, our role as a bank provides the zakat agency with a more efficient and comprehensive cash management services from its zakat collection through to its distribution, as LZS capitalises on Maybank’s vast service network and digital banking,” said Maybank Islamic Chief Executive Officer Dato’ Mohamed Rafique Merican.

LZS will be collecting zakat through multiple collection channels such as M2U, Maybank’s e-wallet app or MAE, JomPay and credit and debit cards whereas zakat received over the counter will be deposited through a remote deposit system located at the respective branch.

LZS CEO Mohd Sabirin Mohd Sarbini said the agency currently provides more than 10 ways for Muslims in Selangor to pay their zakat.

“The partnership with Maybank Islamic completes our network of service facilities. Our cooperation with the Maybank Group began in 1998 under Malayan Banking Berhad and we moved to Maybank Islamic in 2022 in line with our aspiration to partner with Shariah-compliant institutions,” he said adding that as a payment channel platform, Maybank played a role in the increase of zakat collection in Selangor where last year, the amount collected via Maybank reached RM52.8 million. This amount comprised 63% of the total collection derived from the payment channel platform of other financial institutions appointed by LZS.

Last year, LZS received a record zakat collection of RM1.07 billion and distributed RM1.05 billion, benefiting more than 350,000 asnaf individuals. The majority of the zakat, or RM885 million, was dedicated to social, educational, and religious institution pillars and over RM700 million in zakat was allocated towards social development for the asnaf community in Selangor.

As the urban poverty rates in Selangor continue to rise, there is an increasing recognition of the importance of providing assistance to those in need. The commitment to collecting RM1.5 billion by 2025 reflects LZS's dedication to creating a sustainable support system for the Asnaf population which potentially reaching 400,000 recipients. These funds will be utilized to provide financial assistance, education, healthcare, and other essential services to those in need," stated Mohd Sabirin.

“We are grateful to LZS for this strategic collaboration and we welcome more cooperation with other zakat collection agencies in the country as we believe this can further improve the collection and distribution of zakat,” said Dato’ Mohamed Rafique adding that zakat as a financial instrument has a significant potential to build resilience, address marginalisation and vulnerability whilst also promoting social and economic inclusion.

This collaboration with LZS is aligned with one of the 5 pillars of Maybank Islamic’s Islamic Wealth Management (IWM) solutions, that is the wealth purification pillar where Muslim customers are provided with an efficient platform for them to fulfill their religious obligations.

Maybank Islamic’s IWM holistic solutions covers all wealth management pillars from wealth creation, accumulation, protection, purification to distribution. Under the purification pillar, the Bank aims to be the preferred channel for customers seeking to fulfill their Zakat, Sadaqah, and Waqf obligations with utmost ease and peace of mind.

To this end, Maybank Islamic had in June launched the country’s first digital zakat auto debit for deposits and investment accounts to provide convenience for up to 4 million eligible customers who now can consolidate all their zakat payments into a single statement and fulfil their zakat obligations at ease, via Maybank’s digital channels.

Dato’ Mohamed Rafique said the digital zakat auto debit is one of the many digital service offerings that are currently being developed for IWM’s purification pillar.

“This aligns with the value-based initiative (VBI) and sustainability metrics set by the Maybank Group. In terms of the reach of the digital zakat auto debit in the long run, we intend to make it available across our other home markets namely Indonesia and Singapore,” he said.