Conceptualizing Asnaf Entrepreneurship for Zakat Institutions in Malaysia

The aim of this paper is to propose a conceptual framework to explore the challenges of the current practices of the asnaf entrepreneurship program and to establish Islamic entrepreneurship ecosystem as a mechanism in the development of the program among zakat institutions in Malaysia. This research will use qualitative study methods in gathering the primary data from informants among officers in zakat institutions, the asnaf entrepreneurs, the business advisors/experts and academicians. The collected data will be assessed to verify on how the program may help to develop the economy of the asnafs. Even though there is no ideal case as regard to the Islamic entrepreneurship ecosystem in this current world, zakat institutions may provide such alternative ecosystems. The findings of this research is expecting to enhance zakat institutions, Muslims societies, general publics, and policy makers on how this program may elevate the economic status of the asnaf from zakat recipients to become the zakat payers. Thus, the results of this research are anticipated to provide the landscape on how the asnaf entrepreneurship program may positively increase the income of the participants specifically and the societies in general.


INTRODUCTION
Asnaf entrepreneur is not a newly invented group under eight (8) asnaf as mentioned in the Al-Quran Surah At-Taubah Verse 60. But it is an identified individual of productive asnaf those under any of eight categories which has capability to become an entrepreneur. His or her life status and financial condition normally becoming the distress that put him/her under the asnaf category. Under this category, asnaf is considered as non-bankable and excluded from the main stream of financial services (Al-Mubarak, 2016). Therefore, the initiation of asnaf entrepreneurship program targeted to this group is to elevate them from poverty, to 'graduate' from asnaf status and at the later stage to become 'muzakki' (zakat payers). This program is actually under zakat.
Zakat is one of the five (5) pillars in Islam and consider as an act of worship. In Al-Quran and Al-Hadith, zakat always pairs with 'as-solah' and it is always discussed in the chapters of 'Ibadah' in many books of Fiqh. On the other hand, according to Qardawi (2009) zakat is an act of worship which relates human being with the other human being and with the purpose of devotion to Allah Azzawajalla which covers at least three aspects which are, first (1) to release individual from the burden of slavery, second (2) to assist in closing the gap between those who have wealth with the one who has not (the insufficient versus the sufficient), and the third (3) is to use the fund to spread and defend the message of Islam (dakwah).
Due to this trend, creative and innovative solutions on how to collect and distribute zakat are becoming among the main agendas in zakat management studies. According to Qardawi (2009) the law of Islam remains constant while the ruling and implementation probably may change according to the place, time and circumstances.
On this basis and the aim to empower the productive asnaf to generate income up to the level of graduation from the asnaf status, thus Zakat Institutions in Malaysia have introduced an asnaf entrepreneurship program which has a high potential to success provided both sides are giving full commitment in realizing it.
Abdul Hamid (2013) highlighted that the conversion successful rate from the whole participants were between 30% to 60% or 3 to 6 (participants) from 10 participants who exit (graduated) from the asnaf status. This percentage was meaningful as the impact of one entrepreneur may give a chain of benefits for others. Among the benefits are the employment opportunity, infaq, economic development and community support.
It is a local multiplier effect which benefits the local economy through the linkages of expenditure (Karlsson, Gråsjö, & Wixe, 2015). This is a good program that the success is not measurable based on the conversion rate from asnaf to muzakkis only but also the other indirect impact to the economy. Therefore, this study will support practitioners and scholars to investigate the challenges of the current practices of the asnaf entrepreneurship program and to establish Islamic entrepreneurship ecosystem as a mechanism in the development of the program among zakat institutions in Malaysia. In order to do so, this study is organized as follows: First (1 st ), the literature review on the asnaf entrepreneurship in Malaysia, the concept involves, and the critical analysis of the related entrepreneurship elements. Second (2 nd ), the problem statement. Third (3 rd ) is the description of the research methodology and samples. Fourth (4 th ) is the discussion about the proposed conceptual framework. And finally, the summary which provides the probability for the future discovery.

PROBLEM STATEMENT
The entrepreneurship program needs to become the flagship in upgrading the status of productive asnaf. The potential and the achievement of the program recorded by LZS, MAIWP and MAIDAM in converting the asnaf entrepreneurs to become the zakat payers have triggered the interest of other zakat authorities to replicate the similar program (Abdul Ghafar et al., 2017). However, Muhamat, Jaafar, Rosly, & Manan (2013) stated that this program is still being questioned whether it is beneficial to the recipients or not. It is mainly due to the fact that any program initiated by the government is not really meeting their targets' needs Andrews (2018). On top of that, Shane (2009) pointed out that the effort of establishing the new start-up is not a good policy. This is due to the nature of this establishment which is not innovative, unable to create job opportunities and only create minimum wealth.
However, in the case of LZS, for the year of 2016, there are 175 participants out of 300 recipients that have graduated from asnaf status. Out of these, only a few numbers have elevated their business from micro to small or at least to maintain the status quo as micro entrepreneurs. The remaining are not successful in the business or out of radar and uncontactable.
On the other hand, MAIDAM has allocated as much as RM654,853 in the year of 2014 for 295 participants. The allocation was only 0.83% from total distribution for that particular year. It was used by the participants as capital in various types of businesses such as food and beverages services, automobile workshops, grocery stores, clothe stores, tailor shops and many more. However, based on the study done by Abdul Ghafar et al. (2017) at least eighty percent (80%) of the total participants have yet to reached the satisfied level in business operation. He opined that there was an entrepreneurship talent gap that needed to fill in to improvise the output of the program.
Meanwhile in 2018, MAIWP has distributed as much as RM1.08 million toward 460 recipients under the similar program. According to Majlis Agama Islam Wilayah Persekutuan (2018), it was a 'high impact' distribution to improve the economic status of the asnaf from a recipient to a contributor. This program has produced ten (10) participants who have earned between RM8,000.00 to RM30,000.00 per month each and it was considered as an achievement.
The entrepreneurship program under zakat institutions need to properly identify the type of asnaf that has potential to be a successful businessman. Abdul  had identified the zakat recipient who is currently in hardship but has potential to develop, grow and graduate from asnaf status as the one that is appropriate to receive this support. However Rahman & Ahmad (2011) had questioned whether this investment will give a successful return or otherwise. Any failure of this allocation or arrangement will jeopardise the right of the other asnafs toward the pool of funds. Therefore, the need for introducing the comprehensive entrepreneurship model dedicated to asnaf entrepreneurs is very important

RESEARCH METHODOLOGY
The method to be used in this study is in-depth interviews by way of case study method. The case study will be used as a methodological approach in gathering the data and organising the research. There will be fifteen (15) case studies to be developed in order to capture the data from the zakat officers, asnaf entrepreneurs, business advisors and academicians. The outcomes of these research processes will be represented in many ways, among them are tables and graphics.
Basically there are three (3) types of case study which are (1) exploratory, (2) explanatory and (3) descriptive (Yin, 2003). This research will be using the exploratory case study in order to answer the 'what' challenges that asnaf entrepreneurship program faces in this current practices and 'how' to establish the Islamic entrepreneurship ecosystem that will benefit the society. Based on this methodology, the informants are from three (3) zakat institutions (LZS, MAIWP and MAIDAM) which consist of zakat officers, asnaf, business advisors/experts and academicians in this field. This research will use semistructured interviews which will be conducted face to face. This will give further advantage in term of objectivity and focus (Merriam, 2009) The researcher will use some guided questions as a prelude to the interview session in introducing the research and directing the discussion toward the issues of asnaf entrepreneurship program. After the interview, the researcher will proceed with a transcribing process meticulously by using 'Microsoft word' software. This report will be shared with the informants in order to reaffirm the contents that tallied to what be informed earlier in the interview process. Based on this method, it will strengthen the level of validity and trust ability of the received data. The results from the interviews will be used in preparing the conclusion for this research. It will answer the last objective of the research which is to propose 'Al-Qawiyyun Al-Amin' entrepreneurship model of asnaf entrepreneurship programs among Zakat Institutions in Malaysia context.
The study focuses into these three (3) states which are Lembaga Zakat Selangor, (LZS), Majlis Agama Islam Wilayah Persekutuan (MAIWP) and Majlis Agama Islam dan Adat Melayu Terengganu (MAIDAM) as a scope of study. These three (3) states have put their effort not only to increase the collection through a lot of awareness programs but also to upgrade the eligible zakat recipient to the level of zakat contributor. The purpose of doing this is to upgrade the Muslims economy, to reduce poverty and to increase the number of zakat contributors.

LITERATURE REVIEW The Underlying Theory of Asnaf Entrepreneurship
In this section, the researcher will discuss the theories which are related to this research. It will start with Theory of Planned Behavior (TPB) in discussing asnaf entrepreneur matter and to be followed with Resource Based View Theory (RBV) in focusing into the Zakat Institution perspective. Theory of Planned Behavior (TPB) was developed by Ajzen in 1985(Ajzen, 2012 based on the Theory of Reasoned Action (TRA) which was expanded by Fishbein & Ajzen (1975). Originally, TRA proposed that there were two (2) variables that will stimulate the behavioral intention which were (1) attitude toward act or behavior and (2) subjective norms. In the case of TPB, the developer had added the perceived behavioral control as the third predictor in determining the behavioral intention. It was defined as the willingness of a person to execute certain specified action.
Meanwhile, RBV is a theory that was developed by Wenerfelt in 1984 (Usop, 2019) and promoted at the later stage by Barney (1991). It is known as a theory that promotes the sustainability competitive advantage of the entity or organization through four (4) practical indicators which are value, rareness, imitability and substitutability (Barney, 1991). According to Usop (2019), this theory used only four (4) main sources which are human resources, organization, physical resources and capabilities. These four (4) main sources are important in generating the competitive advantage of the entity or organization.
In detail, the resources are very important in determining the competitiveness of an entity according to this RBV theory. There are at least two (2) types of resources controlled by the entity which are tangible and intangible resources. The ability of the entity to generate the competitive advantage by using both resources is known as capabilities. Both theories are to be used respectively according to its suitability based on the needs and requirements of each angle.
As regards to the Islamic entrepreneurship,  mentioned that an Islamic entrepreneur is not much different from a normal entrepreneur, he or she is a mere business player but having certain guidelines and standards. He/she will only be involved in (1) productive and socially desired halal activities and (2) held responsible for the sustainability of the environment and natural resources. He/she will never be (1) greedy, (2) misled by misrepresenting products, concealing defects or misleading consumers, (3) hoard and (4) accept interest (riba). He/she will act at the best level of (1) decency, (2) honesty, (3) frankness, (4) compliance to the contract, (5) trustworthy. In other words, an Islamic entrepreneur is assuming to exhibit the best conduct of behavior and to carry out the business in the best halal entrepreneurial approach (Usop, Zainol, & Muhamad, 2018).

Concept Involves
According to shari'ah point of view, zakat is denoted as the activity of contributing a part of a person wealth to the other group of people based on their certain requirements as instructed by the Almighty Allah Azzawajalla (Zakat, Mara, Alam, & Manan, 2013). On the other hand, it also refers to the portion of wealth that is subjected under this contribution. According to Al-Nawawi as mentioned by Al-Wahidi (2008), this portion of wealth is known as zakat because it encourages the remaining wealth to grow and shields them from neglect. Furthermore, Ibn Taimiyah highlighted that zakat will improve the soul of the payer and will clean his wealth. On top of that, Al-Azhari mentioned that zakat also increases the inner and material of the poor concurrent to the positive impact to the donor (Qardawi, 2009).
Allah Azzawajalla has specified the recipients who are entitled to receive the distribution of zakat as stated in the Al-Quran: "The alms are only for the poor and the needy (faqir and miskeen), and for those employed in connection therewith (amil), and for those whose hearts are to be reconciled (muallaf), and for the freeing of slave (riqab), and for those in debt (al-gharimin), and for the cause of Allah (fi-sabilillah), and for the wayfarer (ibnu sabil)-an ordinance from Allah. And Allah is all-knowing, wise." (Al-Quran At-Taubah: Verse 60) (Mawlani Sher Ali, 2004) Basically there are eight groups of people who are entitled for the distribution of zakat named as (1) faqir, (2) miskeen, (3) amil, (4) muallaf, (5) riqab, (6) gharimin, (7) fi sabilillah and (8) ibnu sabil (Al-Quran At-Taubah: Verse 60) & (Sofyani, 2019). The Islamic scholars especially the four schools of thoughts (al-mazahib al-arba'ah) have their own extension and limitation as regard to the definition and meaning of each group. There are some similarities between each other and also disputes. However, the dispute does not lead to the clash but an opportunity for the followers to choose and practice.
Part 1, Article 3 of Federal Constitution of Malaysia stated that the religion for the Federation (Federation of Malaysia) is Islam. Other religions are allowed to be practiced in peace and harmony. This constitution has positioned Islam in a very strategic condition which allows many parts of Islam to be properly implemented and executed. Mapunda (2007) highlighted that Barringer and Ireland (2006) mentioned that many have wrongly assumed as regard to the facts of entrepreneurs are born to be and have some inherited entrepreneurs elements but in reality it is not. Almost all individuals are potential candidates to become successful entrepreneurs. However, in real facts not all business establishments survive and succeed (Cooper, 1995).

The Challenges Elements of the Entrepreneurship
Many recognize the importance of a support system and business conducive environment to the prosperity and success of entrepreneurship. However, the appropriateness of the support system and types of the environment are not similar between each and every type of entrepreneurs. On the other hand, it shares the same scope and framework across the types of business UNEP Finance Initiative Innovative Financing for Sustainability (2008) reported that the common failure of the business is due to the poor financial management (Drexler, Fischer, & Schoar, 2013), funding and financial issues (Harper, 1997 andYousef, 1998), business management and entrepreneurship issues (Barringer &others, 2015 andMapunda, 2007) and strategic and operational issues (Linder & Williander, 2017), .and (Ramli, Ahmad, Wahid, & Harun, 2011) .

The Reliability Elements of the Asnaf Entrepreneurship
The success of the program is dependent on to the success of the content of the program itself. As regard to the asnaf economic development program in general and asnaf entrepreneurship in particular conducted by zakat Institutions, this is the addendum program which attached into original religious program i.e. zakat distribution, with the purpose of elevating the efficiency and effectiveness of the distributed zakat fund (Abdul  and (Zainol, Daud, Abdullah, & Yaacob, 2014).
On the other hand, zakat itself has its own purposes (also known as maqasid al-zakat) which are at least (1) to satisfy the distribution of wealth among societies, (2) to clean the wealth from others right and purifying their heart (3) to avoid the societal problem which caused by poverty and (4) to develop the Islamic identity (Al-Mubarak, 2016). Therefore, the assessment on the reliability elements of the program is very important in identifying the strength and gap for the improvement. Thus, in this section, it will cover the aspect of fund and replenish-able (Ramli et al., 2011), sustainability (Kamali, 2016)., justice (Mohieldin, Iqbal, Rostom, & Fu, 2012), success rate (Abdul Hamid, 2013) and maqasid shariah (El-Mesawi, 2006;Nurmaizura Marzuki & Hairunnizam Wahid, 2017).

The Islamic Entrepreneurship
Islam is a religion of Allah that revealed to the prophet Muhammad SAW since more than 1400 years ago (Haneef, 1997). It consists of three (3) basic components which are Aqidah (faith and piety), Shari'ah -Islamic Law (activities and relationships) and Akhlaq -(code of conduct) .
Aqidah is about the consciousness of the existence of Alllah SWT (The Creator) and the consciousness of His presence in all parts of our life (Ismail, 2012). Those with this faith are known as Mukmin. This Mukmin is required to follow certain requirements based on the guidance revealed by Allah SWT to the Prophet Muhammad SAW in order to perform ibadah (the act of obedience to Allah SWT) and muamalat (the human to human/mankind/other creatures' relationship) (D. Ahmad, 2012). This guidance is known as shari'ah with the purpose of guiding the human being to the comfort of the worldly life and hereafter (Hassan, 2011). Meanwhile, akhlaq comes forward as a code of conduct for human being to act among them, with other creatures and also with the Almighty Allah  Entrepreneurship falls under muamalat (shari'ah category). The basic principle of mualamat is permissibility of everything except those forbidden by the shariah as compared to the ibadah which based on the basic principle of forbidden except those permissible by the shariah (K. Ahmad, 2009). As an example, all businesses are permissible except those involved in haram transactions such as gambling, riba and alcoholic drinks (muamalat). Meanwhile, Muslim is not allowed to create his own method of ibadah as an example to perform Zohor five (5) rakaats instead of four (4) rakaats as directed by the shariah.
The Islamic Entrepreneurship starts with the intention of seeking the pleasure of Allah and at the same time to gain halal income. As compared to the western entrepreneurship which is self-centred and individual profit oriented . In Islam, the entrepreneur will act according to the shariah by preserving the akhlaq of Muslims in gaining reasonable income and expending moderately for themselves and the ummah as a whole.
Furthermore, Allah SWT has laid down two (2) main factors in selecting the correct candidates to be appointed for certain appointments which are 'Al-Qawiyyun' and 'Al-Amin'. These two (2)  The Islamic Entrepreneurship Ecosystem and The Asnaf Entrepreneurship Model 1 st Proposition: Through the enhancement of the Asnaf Entrepreneurship Program, mission to develop the economy may be achieved through upgrading the zakat institution; 2 nd Proposition: Through the integration with the entrepreneurship elements, recognizing the challenges and the reliability of the program, mission to develop the economy may be achieved through upgrading the asnaf entrepreneurs and businesses; 3 rd Proposition: Through the assessment of the Al-Qawiyyun, Al-Amin and the Islamic entrepreneurship environments, a mission to develop the economy may be achieved to upgrade the zakat institution. 4 th Proposition: The enhancement of the Asnaf Entrepreneurship Program requires business efficiency to upgrade the zakat institution; 5 th Proposition: The integration with the entrepreneurship elements, recognizing the challenges and the reliability of the program requires business efficiency to upgrade the zakat institution; 6 th Proposition: The assessment of the Al-Qawiyyun, Al-Amin and the Islamic entrepreneurship environments may lead to the establishment of the Islamic Entrepreneurship Ecosystem and The Asnaf Entrepreneurship Model.

CONCLUSION
It This research aims to explain that the relationship between the asnaf entrepreneurship program and the zakat institution will give a positive impact to the development of the asnaf economy. The result of this research will improve the perception of the zakat stakeholders that the asnaf entrepreneurship program is effective in upgrading the economy of the asnaf in specific and the society in general. This research is also anticipated to be beneficial for the other zakat authorities to replicate the same program in their respective territories in empowering the productive asnaf.