The mechanism of zakat and sadaqah may be combined with the microfinance activities in order to manage the default of repayment that might be occasioned by extreme poverty.

Question

Quizplus · Accepted Answer

Zakat and sadaqah, being forms of charitable giving in Islamic finance, can be integrated with microfinance activities to provide a safety net for borrowers who might default due to extreme poverty. This integration can help in managing repayment defaults by offering financial support to the needy, thereby ensuring the sustainability of microfinance initiatives.

The Mechanism of Zakat and Sadaqah May Be Combined with the Microfinance