Zakat is not merely charity; it is an instrument for societal change.

Zakat is not merely charity; it is an instrument for societal change.

Proposal for Zakat: Financial Empowerment of the Community

1. Executive Summary

Our community faces high levels of unemployment and financial instability, especially among vulnerable households. The People of Hope NGO, based in Shaheen Bagh, Delhi, aims to use zakat funds for the economic empowerment of community members. This project will provide financial assistance for small business setups and support travel expenses for individuals seeking employment abroad. Beneficiaries will repay the assistance in installments, enabling a revolving fund model that sustains growth and financial independence within the community.

2. Background and Need

The community of Bihar, like many other rural areas in India, suffers from limited job opportunities, lack of formal employment, and inadequate support for aspiring entrepreneurs. This leads to an economic dependency on seasonal, low-paying jobs. Young adults and breadwinners often seek better opportunities overseas but lack the resources for travel and initial expenses.

Without access to financial resources, potential entrepreneurs are unable to start their own small businesses, and others cannot pursue job opportunities that would provide sustainable income for their families. This initiative aims to create a pathway to financial stability by addressing these two needs.

3. Project Objectives

The primary objectives of this zakat-funded project are:

• Support Small Business Initiatives: Help individuals set up small businesses in their local areas by providing financial aid to cover initial startup costs.
• Facilitate Overseas Employment: Offer travel allowances and essential support to those with job opportunities abroad, enabling them to cover initial expenses until they become self-sufficient.
• Create a Revolving Fund: Beneficiaries will repay the zakat amount on an installment basis once they achieve financial stability. These repayments will create a revolving fund to support more individuals over time.

4. Project Approach

This project adopts a two-pronged approach to empower the community financially:

4.1 Small Business Support

Through this component, selected beneficiaries will receive funding to establish small, locally relevant businesses. These could include retail shops, home-based manufacturing units, or service-oriented businesses (tailoring, repair services, etc.). Support will include:

• Initial Capital: Up to 50,000 INR per person to help set up the business.
• Basic Training: Guidance on business management, basic accounting, and customer service to ensure sustainable growth.
• Mentorship: Periodic mentoring from experienced local business owners to address challenges and sustain profitability.

4.2 Travel Allowance for Overseas Employment

To help individuals secure overseas jobs, this project will provide:

• Travel and Initial Support Allowance: Funds for airfare, visa fees, and other initial expenses.
• Post-Arrival Support: Connections with local networks abroad, where possible, to assist with initial job placement and lodging.
• Repayment Program: Beneficiaries will begin installment repayments once they secure stable employment, allowing the fund to support future candidates.

5. Implementation Plan

Phase 1: Needs Assessment and Selection (Months 1-2)

• Conduct a community assessment to identify unemployed individuals and aspiring entrepreneurs.
• Establish selection criteria, prioritizing those from low-income backgrounds and larger dependents.

Phase 2: Training and Initial Financial Support (Months 3-5)

• For small business beneficiaries: Disburse funds, conduct training, and pair with mentors.
• For overseas job seekers: Disburse travel allowance, assist with paperwork, and establish contacts for post-arrival support.

Phase 3: Monitoring and Support (Months 6-12)

• Monitor business progress and employment outcomes.
• Provide ongoing mentorship for business owners.
• Ensure job seekers are settled and prepared to start repayments.

Phase 4: Revolving Fund and Expansion (Post Year 1)

• Collect repayments from beneficiaries as they achieve financial stability.
• Use these funds to expand support for new beneficiaries, thereby creating a sustainable cycle of empowerment.

6. Sustainability Model

A core aspect of this project is its revolving fund model. Beneficiaries agree to repay the zakat assistance once they achieve stability, in installments based on their financial capacity. These repayments will be used to help new beneficiaries, creating a self-sustaining fund that amplifies the impact of the initial zakat contribution. This cycle of support ensures that every zakat donation has long-term benefits and reaches more individuals over time.

7. Impact Measurement and Accountability

To ensure transparency and accountability, we will implement:

• Monthly Reports: Detailed reports on the disbursement and utilization of funds, as well as project impact metrics (number of businesses launched, jobs created, etc.).
• Beneficiary Testimonials: Regular updates and stories from beneficiaries, illustrating how zakat has transformed their lives.
• Annual Audits: A third-party audit of financial records to ensure all funds are used in accordance with zakat guidelines.

8. Why Zakat for Financial Empowerment?

Zakat is not merely charity; it is an instrument for societal change. By empowering community members to become financially independent, this project aligns with the principles of zakat, which include alleviating poverty and enabling individuals to become self-sufficient. Supporting the financially vulnerable with opportunities for sustainable income not only uplifts them but also strengthens the community as a whole.

9. Budget

Here’s an estimated budget for the initial phase of the project (100 beneficiaries):

10. Conclusion

Through this zakat-funded initiative, People of Hope aims to uplift community members by providing financial support for sustainable employment and entrepreneurial opportunities. By investing in small business development and overseas job placement, we create a path to economic independence that aligns with the spirit of zakat. With your support, we can empower our community to break the cycle of poverty and contribute to a brighter, more prosperous future for all.

This proposal covers the key components you might need. Let me know if there are any specific elements or adjustments you’d like to add, and I can tailor it further!