The Prospect of Waqf in Financing Small and Medium Enterprises (SMEs) in Yemen

Abstract

The role of small and medium enterprises (SMEs) in economic development has been duly recognised. However, SMEs encounter a number of challenges. The most pressing obstacle SMEs face is the lack of finance. Therefore, it is extremely important to find new and suitable finance sources in order to support SMEs either in their establishment or growth phases. Waqf is regarded one of the best sources of finance in the Islamic financial system. There is much potential in its use to finance SMEs financing. The present study explored the prospect of Waqf as an Islamic financial instrument to finance SMEs. It further examined a proposed modified Waqf model and whether it was applicable in Yemen. The study has adopted a qualitative method in the form of semi-structured interviews with 6 experts from Waqf institutions and from SMEs developmental institutions. The experts interviewed are mainly SMEs owners, Waqf directors and beneficiaries specialized in the areas of Waqf and SMEs. The findings of the study indicate that Waqf appeared to be one of the most important instruments in financing such economic activities as it can play a crucial role in financing SMEs. Further, the study significantly contributed by suggesting a new method that will help in financing small and medium enterprises (SMEs) in Yemen. Thus, providing a finance for these firms will help to create more jobs for the low income, which in turn helps in the economic development.

The integration of Islamic social and commercial finance (IISCF): Systematic literature review, bibliometric analysis, conceptual framework, and future research opportunities

“…Several sub-topics were also identified in the proposed model literature. The utilisation of waqf dominated the IISCF proposed model topic, with most of the sub-topics related to waqf properties/asset development [ 72 , 68 , 55 , 3 , 73 , 56 , 66 , 65 ] and entrepreneurship [ 12 , 27 , 28 , 29 , 30 ]. Four works of literature were found on the sub-topic of Islamic microfinance and entrepreneurship integration [ 26 , 93 , 87 , 98 ].…”

“…To develop the agricultural sector in Indonesia, Baitul Maal wat Tamwil (BMT) can operate a Salam-Muzara'ah Linked Waqf (SMW) model, which integrates returns from cash waqf to empower waqf land. A waqf-based financing model can also be adopted in Yemen to address the issues surrounding SME access to capital, in turn creating job opportunities and encouraging economic growth [ 30 ]. The microfinance integration model is also thought to have effectively assisted SMEs with capital problems in other countries, including Uganda [ 93 ] and the UK [ 26 ].…”

“…Moreover, to examine the success factors and barriers as well as compare the achievement with the determined baseline scenarios, it is also worth investigating further the impact of the IISCF model development, which is expected to develop various waqf assets [ 72 , 68 , 55 , 73 , 56 , 66 , 65 ], increase public literacy about cash waqf and nazhir performance [ 56 ], and empower entrepreneurship [ 12 , 27 , 28 , 29 , 30 , 62 ]. Studies on Muslim behaviour, product development, business models, and marketing strategies are also essential to support innovation in future IISCF research because Muslims worldwide interact in various social, economic, and legal systems.…”

“…Zakat has also been shown to help reduce income inequality when it is supported by integration with Islamic commercial finance institutions such as Islamic microfinance and Islamic banks [ 22 ] and is used to support the community's well-being [ 9 , 23 , 24 ]. Therefore, over the last decade, many studies have been conducted on the integration of Islamic social finance with the role of Islamic commercial institutions, namely financial (Islamic banking and non-banking) and non-financial institutions such as education [ 5 , 7 , 25 , 8 ], healthcare [ 4 ], and other business sectors [ 26 , 12 , 24 , 27 , 28 , 29 , 30 , 31 ].…”

Implementation of Intellectual Property Rights Waqf in the Urban Society of Medan Based on Maqasid Shariah

“…Any form of violation of IPR, including but not limited to using, disclosing, making, using, selling, importing and exporting, distributing, handing over, providing, announcing, reproducing, creating, falsifying, hijacking, IPR belonging to others without rights is tyranny and the law is haram. The registration process for Waqf with IPR objects is similar to other types of Waqf, with one additional requirement for the waqif (the donor) (Saad et al, 2022). The waqif must provide proof of IPR registration from the Directorate General of Intellectual Property (DGIP) of the Ministry of Law and Human Rights as evidence of ownership to be endowed (Lubis, 2020).…”