JAKARTA – Dompet Dhuafa and the Indonesia Stock Exchange (BEI) recognize the significant potential of capital market waqf among millennials. At a talk show titled “Millennials and Waqf in the Capital Market” on Friday (3/11/2023), Dompet Dhuafa and BEI engaged in discussions on investment to encourage both spiritually and financially intelligent practices. The event, attended by hundreds of students, bloggers, and media personnel, was held at the BEI building in South Jakarta.
The capital market, growing in popularity among millennials, offers various conveniences and benefits, attracting their interest. Dompet Dhuafa sees this enthusiasm as a substantial opportunity to enhance the world of waqf. The introduction of Cash Waqf Linked Sukuk (CWLS) facilitates easier participation in waqf for millennials. This concept has successfully made waqf assets more productive.
The talk on smart investing featured experts such as Irwan Abdalloh, Head of the Sharia Capital Market Division, Zainal Falah, Head of POEMS Shariah at PT Philip Securities Indonesia, Izzuddin Abdul Manaf, Sharia Supervisory Board of Dompet Dhuafa, and Frisca Devi Choirina, Co-Founder of @ngertisaham.
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Rahmad Riyadi, Chairman of the Dompet Dhuafa Republika Foundation, in his opening remarks, highlighted the importance of discussing the treasury of waqf. Dompet Dhuafa continues to explore waqf as a pillar of Islamic economics, with a potential value of IDR 200 trillion in Indonesia.
Rahmad expressed his hope for the attendees to become professional and competent in the Islamic economic sector.
As of October 2023, there are over 400 waqf trustees in Indonesia. However, this number is insufficient to fully realize the potential of waqf. Dompet Dhuafa annually collects only about IDR 20 billion in waqf, a small amount compared to the vast potential. Therefore, partnering with the capital market is essential for developing waqf awareness and growth.
Irwan Abdalloh stated that the primary target market for waqf in the Sharia capital market is young people. According to BPS data from 2020, 97% of Indonesia’s population is of productive age. BEI views the Sharia capital market as a platform for both profit and social contribution, believing these aspects can coexist. Although waqf development in 2019 started slowly, due to its association with madrasas and mosques and the limited financial resources of young people, progress has been made.
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“As of September 2023, the value of waqf assets in stocks amounted to only about IDR 280 million,” Irwan revealed.
He clarified that trustees (nazir) are the main actors in waqf. Securities players cannot be forced to become nazir. When someone wants to contribute waqf through securities, the nazir manages it. The business of securities remains unchanged. If a securities company wants to include a waqf instrument, it must partner with a waqf manager, i.e., the nazir.
From the Sharia perspective, Izzuddin explained that assets that do not decrease in value are capital. Discussing waqf as a constant asset is similar to discussing the capital market.
While zakat, infaq, and charity are more socially oriented, waqf must remain constant. Assets like capital predominantly focus on the commercial side to ensure stability and growth. This concept is akin to modern investment practices.
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“Developing waqf is similar to developing assets, akin to using investment instruments. Hence, investment strategies also apply to waqf asset management,” he elaborated.
Frisca shared her investment experience from a youth perspective, having been familiar with investing since college. She understands how investment and waqf can coexist, leading to both financially and spiritually smart money management.
Zainal Falah from Philip Securities chose Dompet Dhuafa as a nazir partner due to its long-standing reputation and professionalism in managing waqf funds.
“We believe Dompet Dhuafa is a suitable partner for Philip Securities in this philanthropic activity, especially in waqf sukuk instruments,” he asserted.
Dompet Dhuafa’s efforts in stock waqf aim to make it a habit among investors, potentially increasing the ownership share in public companies.
Capital market waqf offers an alternative for young or millennial investors to share and spread wider, long-lasting benefits. In this mechanism, investors conduct stock waqf transactions with securities companies, which then transfer the stocks to the nazir’s securities account for management. The eligible stocks for waqf are Sharia stocks.
Sharia stocks for waqf are deposited or handed over to investment management institutions. The profits from managing Sharia stocks by investment managers are then transferred to waqf management institutions.
Dompet Dhuafa, in collaboration with Securities, will actively socialize and educate the public about the importance and benefits of stock waqf. (Dompet Dhuafa/Muthohar)