Applying the principles of ma‘alat and fiqh al-muwazanat in resolving disputes over the microcredit zakat fund (MZF) for Asnaf entrepreneurs

Purpose This study aims to identify the differences of opinion among zakat policymakers in Malaysia regarding the implementation of the Microcredit Zakat Fund (MZF) scheme for asnaf entrepreneurs, and to propose a resolution framework based on the principles of ma‘alat (consequential reasoning) and fiqh al-muwazanat (jurisprudence of balance). Design/methodology/approach This qualitative study used both library research and fieldwork. The library research involved an in-depth analysis of books, scholarly articles, statutory instruments and relevant administrative circulars. Fieldwork was conducted through unstructured interviews with five zakat institution officers, five officers from State Mufti Departments and two academic professors specialising in Shariah and zakat studies. The interview data were analysed using content analysis to identify key themes. Findings The study revealed a significant divergence of views on the MZF scheme. Three zakat institutions and three fatwa institutions from the same state supported the scheme, citing khilaf mu‘tabar (recognised juristic disagreement), the scope of ijtihad and contemporary considerations of maslahah (public interest). Conversely, two zakat institutions and two fatwa institutions rejected the scheme based on the principle of tamlik (full ownership), in line with current fatwa positions and contemporary ‘urf (customary practice). They also expressed concerns over potential mafsadah (harms) such as indebtedness among asnaf, fund mismanagement and weak governance. However, the study found that the supporting arguments align more closely with current realities and the objectives of zakat (maqasid al-zakah), while the objections raised by the opposing view could be addressed through conditional implementation and robust regulatory mechanisms. The study thus proposes a resolution approach grounded in fiqh al-ma‘alat, fiqh al-muwazanat, and a dual-fatwa framework that considers local context. Research limitations/implications The study focused solely on zakat and fatwa institutions from a single state. Future research is recommended to expand the scope to other states for a more comprehensive comparative analysis. Practical implications This study offers guidance to policymakers in formulating harmonised approaches to the MZF issue based on local realities and maqasid al-zakah. It also provides a principled framework for justifying either acceptance or rejection of the scheme in accordance with Shariah standards. Social implications A well-structured and controlled MZF scheme has the potential to empower asnaf economically through responsible micro-financing, thereby enhancing their competitiveness and reducing long-term dependence on zakat aid. The scheme could elevate asnaf from recipients to contributors of zakat, contributing to more inclusive and sustainable economic development. Originality/value To the best of the authors’ knowledge, this study is among the first to integrate empirical findings with the principles of ma‘alat and fiqh al-muwazanat in evaluating the feasibility of MZF implementation within the framework of zakat governance and fatwa issuance. It further asserts that harmonisation does not entail unifying all views into a single position, but rather recognising contextual diversity and the need for responsive legal rulings.