A Comparative Evaluation of Zakat Management Systems: Lessons from the Malaysian Model and Challenges in Bangladesh

Abstract

Eliminating extreme poverty and hunger is a top 21st‑century global concern. While Zakat—an Islamic obligation—proved effective in the past, its current fragmented and inefficient implementation renders it unsuitable for sustaining a modern economy. The proposed paper will entail a comparative evaluation of Zakat management in Malaysia and Bangladesh, based on governance, institutional performance, and performance in development. It elucidates that a direction of Zakat is a plan of socio-economic growth. It is grounded on a qualitative comparative case study approach to the study, paying attention to policy documents, institutional reports, and Islamic literature. Regulatory frameworks, operational transparency, and the incorporation of digital and financial innovation are the specific areas of the analysis.  The main findings indicate that the centralized, state-managed system in Malaysia, reinforced by strong legal forces and digitalization, has been effective in making Zakat a powerful tool of inclusive development. On the other hand, Bangladesh has quite decentralized and informal practices, with weak regulation and fractured, incomplete adoption of technology, which significantly limit its influence on development. The research contributes to a governance-based comparative institutional framework by offering policy-relevant recommendations to rebrand Zakat as a sustainable poverty-reduction and development instrument.