We take this matter extremely seriously, as we have been honored to receive some 15 fatwas that form our approach to both governance and compliance. Piloting UNHCR’s Refugee Zakat Fund in 2018 and 2019, then establishing the fund in 2019, came as a result of issuing several fatwas that endorse UNHCR to receive and distribute Zakat funds under certain conditions which UNHCR is always respecting:
- Condition 1: Zakat funds must be given to the categories mentioned in Quran 9:60.
- Condition 2: Zakat funds must not be used to cover expenses or wages.
- Condition 3: Zakat funds should be placed in their own account in an interest-free account.
The pillars/ principles of Zakat-compliance for UNHCR are based on the above conditions. This process of compliance check takes place internally through a specialized Islamic Philanthropy team, and externally through an expert party that annually reviews compliance and issues a compliance review statement. Three such external reviews have been conducted to date (in 2018, 2019, and 2020). It is also set for the OIC’s International Islamic Fiqh Academy (IIFA) to be additional external reviewer.
The first condition is met through our rigorous vulnerability assessment frameworks applied in every distribution country, which enables UNHCR to identify those who are in dire need. The second condition is met by annually and exceptionally waiving our standard 6.5% indirect support costs, and covering fees and wages related to Zakat receipt or distribution from other sources of income to UNHCR (this includes payment processing fees). The third condition is met by having in place a Zakat-specific interest-free bank account in Geneva, constantly monitored by UNHCR’s Islamic Philanthropy team.