The Islamic banking industry in Indonesia is entering a promising new era. Through Law No. 4 of 2023 on Financial Sector Development and Strengthening (P2SK Law), Islamic banks now not only act as Sharia Financial Institutions Receiving Cash Waqf (LKS-PWU), but are also allowed to become nazir or waqf managers. This provision opens up great opportunities for Islamic banks to play a strategic role in the management of cash waqf, which has not been optimized so far.
This change is part of strengthening Islamic social finance in a more professional and transparent manner. As nazir, Islamic banks now have the legal basis to offer more innovative and result-oriented waqf services and products. With their excellence in investment management and extensive network, Islamic banks are expected to be the main driver in collecting and channeling waqf funds for economic and social empowerment.
However, despite the wide open opportunities, the potential of cash waqf in Indonesia is still far from expectations. Based on data from the Indonesian Waqf Board (BWI), the potential of national cash waqf reaches IDR 180 trillion per year. Unfortunately, until 2023, the realization will only reach around IDR 2.3 trillion. Director of Zakat and Waqf Empowerment at the Ministry of Religious Affairs, Waryono Abdul Ghafur, mentioned that the low participation of the public in waqf is the main obstacle. Of Indonesia's total Muslim population of around 238 million, only 6% are registered as waqifs.
Therefore, a number of strategies need to be implemented consistently. First, education and socialization need to be intensified to increase public awareness of the importance of cash waqf as an instrument of economic empowerment. Second, ease of access through digitalization of waqf services is crucial so that people can participate more practically and efficiently. Third, collaboration with institutions such as universities, social foundations, and other financial institutions needs to be strengthened to expand the impact and reach of cash waqf benefits.
With the support of progressive regulations and commitment from various parties, the new role of Islamic banks as nazir can be a catalyst in building a productive, inclusive, and sustainable waqf ecosystem. Cash waqf is not only an instrument of worship, but also an alternative economic force capable of driving Indonesia's future Islamic economic growth.
