Revival of the institution of waqf
The waqf is a versatile organization. It operates in accordance with the legal systems derived from the provisions of Islamic jurisprudence. It operates in constantly evolving organizational and administrative frameworks, affected by modern systems. This large organization must remain a pioneer institution by rejecting any call for stagnation under the pretext of originality. Such a development should be commensurate with contemporary life updates without compromising legitimate foundations.
Governance is one of the main elements of good management. It guarantees transparency, disclosure, responsibility and its limitation. It ensures that the staffing administration complies with legitimate provisions, applicable laws and systems, codes of conduct, Islamic morality and all regulations related to staffing. These guarantees help maintain the endowment fund, its assets, its properties and the rights of the beneficiaries. Its most important tools include laws, systems, strategies, codified procedures that regulate staffing work, a balanced organizational structure commensurate with the volume and objectives of staffing, financial and accounting reports that allow staffing stakeholders to monitor the performance of management bodies, the disbursement of its revenues and the identification of management efficiency levels.
On the other hand, waqf foundations need a regular revenue stream to finance their operations. They cannot achieve financial sustainability by relying entirely on donations. Many find it necessary to broaden their income base to include more stable forms of income from assets under their care, as well as other business activities and investments. Thus, their social work is increasingly linked to commercial interests.
Importance of waqf in supporting voluntary works
Any researcher in the history of Islam can note how easy it is for wealthy people to do good deeds by voluntarily giving alms to build mosques, their extensions and their affiliated housing, by supporting muezzins, imams and workers carrying out cleaning and water supply works, Quran reciters and students. It is also easy for them to build schools and their extensions such as the accommodation of students, orphans and employees, as well as their kitchens dedicated to the preparation of their meal, to the equipment of these schools with the furniture and lighting required and rental of teachers, teaching assistants, and workers … etc.
The problem faced by these voluntary donors is their obligation to provide continued financial support to these religious and educational charities as well as their volunteer workers, so that they can fulfill their religious, human and moral duties. Therefore, these donors, particularly wealthy people, have concentrated from the start of the construction of such facilities on the issue of financial support. They looked for sustainable sources of funding to spend on themselves, their workers and their volunteers. Thus, they have found no better source than waqf as a lasting solution to their financial problems. Therefore, they provide in waqf the best of their capital, orchards, farms and real estate whose returns are sufficient for such projects, aimed at ensuring the sustainability of the returns from these facilities to serve humanity and provide recurring charity until to the day of the resurrection.
The waqf, support for small businesses
Waqf organizations are considered community service and assistance centers.
Evidence from many countries shows the vital role of awqaf and small business partnerships in community development.
The waqf can also be a catalyst for the growth of small and medium-sized enterprises (SMEs). The awqaf can raise capital and channel the funds into the hands of competent managers who have business proposals offering the best chances of success.
The waqf of support is not limited to providing financing or granting loans to existing small businesses, it builds new capacities and sustainable projects. Waqf organizations can be “business angels” forging partnerships with young entrepreneurs, as well as start-up or developing companies.
Financial support from awqaf
The financial support of awqaf is located in three main modes of compliance with Muslim jurisprudence: crowdfunding, concessional, and project funding. Within these modes, different contractual forms fully comply with the principle of profit and loss sharing.
Crowdfunding of SMEs is the most flexible and the most common because it adheres to the Islamic principles of risk and benefit-sharing. This process, in which a waqf, instead of lending money to a company, is involved as a partner or shareholder of the company. The most commonly used participatory modes are musharaka  (equity participation) and mudaraba  (fiduciary financing). For SMEs, crowdfunding is an excellent alternative to borrowing at a higher cost. The involvement of musharaka by waqf facilitates the transfer of a predetermined share of the risk in return for the profits. In the mudarabah, the waqf as a financing provider promotes business development by extending funding to capable but cash-strapped entrepreneurs, so the awqaf bear financial risk and share the profits at a pre-agreed percentage.
Concessional financing is money advanced mainly in the form of a “charitable loan,” where only the principal has to be repaid. It can also be loaned for a small service charge to cover administrative costs. The waqf in cash is the primary source of concessional financing for SMEs. These loans can only be considered in low-risk operations and with adequate collateral to guarantee repayment.
Project financing methods are generally without profit-sharing since they are based on cost plus a predetermined increase. The financing contracts used include Bai Al-Muajjal  (deferred payment contract), Bai al Salam  (forward sales contracts), Ijara  (finance lease financing), Ijara-wa- Iqtina  (hire-purchase), Istisna  (Progressive investment) and Murabaha  (financing based on the cost-plus principle).
The choice of financing method and the type of contract depends on the nature and needs of the project, the risk profile and expected returns, as well as the waqf organization’s investment policy and guidelines.
Non-financial support of awqaf
The waqf can also provide a range of non-financial support to small businesses. The most common in-kind contribution is land. The provision of land for a project serves the development of the properties of the waqf’s objectives and ensures a permanent connection to the project. In these agreements, the estimated current market value of the land is used to determine the share of waqf in the project.
Other types of in-kind support include services such as counseling and training, guidance and supervision, and insurance.
Waqf organizations can also serve as incubators for new businesses, nurture them and help them survive and thrive. The waqf can provide advice and assistance in the areas of strategic planning, which can be particularly helpful during the early stages of business development.
Role of Waqf in establishing fair and affordable prices
The integration of waqf into the market has yielded positive results in terms of providing microfinance, education, and health services at affordable prices for the needy and excluded.
Muslim economists have often sought to make microfinance more affordable by suggesting the integration of zakat and/or waqf into microfinance. A cash waqf with dedicated returns to fully or partially absorb the cost of financial and non-financial services can help ensure that loans are offered at little or no cost, making them interest-free and affordable for those most in need poor.
Better mobilize Waqf resources
Awqaf, in general, have fallen behind common trusts and other forms of charitable and nonprofit activities in response to changing social needs. The creation and management of waqf is a relatively more complex and demanding process, which involves additional financial and non-financial costs. Inciting waqf, similarly to secular trusts and other forms of non-profit organizations, such as through tax breaks on contributions to the donor, would make the system both efficient and fair.
The legal framework should allow all aspects of society to establish a waqf. Laws should allow non-Muslims and institutions to build a waqf as long as the purpose of the waqf is religious or charitable. It should not limit the definition of endowed assets to tangible real estate assets, such as real estate, but should also explicitly recognize movable, financial, and intangible assets, such as cash, stocks, bonds, and financial securities. , transport vehicles, rights to land and buildings, rental rights and intellectual property rights
Towards better management of Waqf resources
Prudent management of the waqf requires the preservation and development of its assets, the investment, and the generation of return on this investment, as well as the guarantee that the profits go to the beneficiaries as provided by the waqif (donor).
The preservation of waqf is the most important concern in its management. The legal framework must clearly state the permanent nature of the waqf arising from the following principle: “Once a waqf, always a waqf.
Originally, waqf is an institution based on voluntary work, the management of waqf being entrusted to individuals. However, in Muslim countries, the state has often sought to play a role in the ownership and control of waqf assets, sometimes governed by grounds of expropriation, and at other times, by the need to combat bribery practices of private trustees. There is no clear answer to the question of whether ownership and management of the assets of the waqf should be in individual or state hands.
When the management of the waqf is in private hands, a controller should stipulate the eligibility criteria developed and clear for a mutawalli or a nazir, or a fiduciary-manager, covering not only aspects of integrity and reliability, but also professional skills. If the person or institution so appointed meets the criteria, the controller must respect the intention expressed by the waqif or the funder. Laws should clearly define the responsibility of the leadership of the waqf to focus not only on preserving and protecting the assets of the waqf but also on their development.
Accountability should also include transparent and honest communication of financial assets and transactions.
The regulations must stipulate the method for determining the remuneration of managers, providing sufficient incentives for sound and professional management of the assets of the waqf. The compensation to which a mutawalli is entitled must not exceed one-tenth of the income of the waqf.
It would be wise to invest waqf assets, whether real estate or movable like money. The investment can generate returns, which can then be applied to the objective for which the waqf was created. Assets purchased using waqf return on investment are not part of waqf and can, therefore, be resold, unlike the original assets which the waqf give. Besides, the conditions provided by the donor or the waqif on the waqf’s investment or the terms about the returns on investment must be spent in specific areas that are also binding. It would be rational to try to minimize the risks by diversifying or avoiding high-risk investment activities. Risk minimization cannot be sought; however, if the purpose of the waqf itself is specific for risky businesses.
Integrating Waqf into microfinance
Microfinance results in high administrative costs, cost control and, of course, high portfolio risk. It is therefore invariably more expensive than traditional sources of funding. At the same time, the microfinance institution and its clients may find this option attractive if they believe that the expected return on the microenterprise is greater than the cost of debt. Such expectations can indeed materialize for successful projects during the “good times”. However, the same may not be true for all projects at all times. Debt liability can aggravate and accentuate the financial problems of a project in bad shape and accelerate its failure. The pace, frequency and intensity of this default is directly related to the level of the cost of debt. Unlike debt, profit and risk sharing mechanisms ensure a clear alignment between the profitability of the project and the cost of capital. The latter goes up and down depending on the profits made by the company.
For-profit financing methods, in line with Muslim jurisprudence, offer no integrated protection against exploitation and abuse through excessive pricing. Improving the financial literacy of poor clients is perhaps the only effective bulwark against such exploitation. The following examples clearly highlight the possibility of exploitation, and therefore the need for financial literacy:
- The returns on micro-murabahah and micro-ijarah financing are deemed to be Sharia-compliant, unlike interest rates. Both can, and often are, raised to the point of exploitation.
- In the case of participatory financing methods such as the murabah, the musharakah and the mudharaa, the sharing ratio could be unjustly biased against the poor beneficiary due to its weak negotiating power. Similarly, in the case of paid financing via wakalah  and haawalah , the microfinance agent institution can charge exorbitant fees for the same reasons.
- The lawfulness of salam  (sale of non-existent products) is linked to the economic advantages that it confers on poor farmers who need financing before they can cultivate or produce their agricultural products. However, salam can involve exploitation when the advance price paid to the poor farmer is artificially set at low levels due to its weak bargaining power.
An economy in Islam favors free prices and allows regulatory intervention only when the natural forces of demand and supply are manipulated to result in an artificial price. By implication, price caps or administered prices are frowned upon in a market where competitive forces are free and fair to determine prices. However, in the case of funding methods where the regulator is able to determine a fair cost estimate, it may seek to regulate the profit margin so that the prices charged guarantee full cost recovery and a fair amount of dividends in the interest of sustainability. Sometimes the identification of an appropriate organizational structure can provide a bulwark against possible exploitation. For example, in the case of salam, an agricultural cooperative can replace the seller and thus prevent the exploitation of individual farmers by the latter.
Source: From Towards a new role of the institution of waqf – Hussein Elasrag
 Contrat d’association par lequel la banque contribue au financement (formation ou augmentation du capital ou prise de participation) de projets ou d’opérations ponctuelles moyennant une répartition des résultats (pertes ou profits). La récupération de son concours indépendamment des résultats ou l’anticipation sur les résultats est nulle.
 La mudaraba ou partenariat passif est un contrat entre deux parties : le propriétaire du capital (rabb-al mal) et un entrepreneur (manager) appelé mudarib. Le profit est distribué entre les deux parties selon un ratio qu’il convient de déterminer au moment de la signature du contrat.
 Bai Al-Muajjal est un contrat entre un acheteur et un vendeur en vertu duquel le vendeur vend certains biens spécifiques autorisés par la charia islamique et la loi du pays à l’acheteur à un prix fixe convenu payable à une certaine date future fixe ou dans un délai période fixe en somme forfaitaire ou par versements fixes.
 Ce terme désigne le paiement anticipé des marchandises qui doivent être livrées ultérieurement. Normalement, aucune vente ne peut être effectuée à moins que les marchandises n’existent au moment de la négociation. Mais ce type de vente fait exception à la règle générale à condition que la marchandise soit définie et la date de livraison fixée. Les objets de ce type de vente sont principalement des choses tangibles mais excluent l’or ou l’argent car ils sont considérés comme des valeurs monétaires. L’une des conditions de ce type de contrat est le paiement anticipé.
 Un contrat de location par lequel la banque achète un article pour un client, puis le loue sur une période spécifique
 Similaire à Ijara, sauf que le client peut acheter l’article à la fin du contrat.
 Un contrat d’acquisition de biens par spécification ou commande où le prix est payé progressivement en fonction de l’avancement d’un travail.
 Forme de crédit qui permet aux clients d’effectuer un achat sans avoir à contracter un prêt portant intérêt. La banque achète un article puis le revend au client sur une base différée.
 Littéralement Wakalah signifie protection ou réparation au nom d’autrui. Légalement, Wakalah fait référence à un contrat dans lequel une personne autorise une autre à effectuer une certaine action juridique bien définie en son nom.
 Système traditionnel de transfert d’argent, effectué via un réseau d’intermédiaires. Les échanges ont pour spécificité de ne pas nécessiter d’échanges de moyens de paiement et d’être basés sur la confiance entre les intermédiaires, avec des promesses non écrites de remboursement.
 Salam est un contrat en vertu duquel une des parties (la banque ou le client), en qualité d’acheteur, avance un montant fixe à l’autre partie qui s’engage, en qualité de vendeur, à livrer une marchandise dûment identifiée à une date fixe. En d’autres termes, Salam est une vente à terme à paiement anticipé. A la signature du contrat, il n’est pas nécessaire que la marchandise soit disponible et propriété du vendeur. Malgré ceci, la banque est tenue de payer le prix en intégralité dans le but de permettre au vendeur de disposer de liquidités. Les créances éventuelles de la banque sur le vendeur ne peuvent servir de prix de la marchandise objet du contrat Salam.