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Poverty is frequently associated with the lack of monetary resources in fulfilling one’s need. However, current developments indicate that there are other aspects that are equally important in addressing the issues of poverty. Thus, accurate diagnosis of the causes of poverty and the identification of the poor and the needy is crucial in ensuring proper assistance is extended to those who are in need. There are two main approaches in identifying poverty namely objective and subjective poverty. Objective poverty is based on income while subjective poverty utilised a participatory approach in determining poverty status. This study further includes zakat (tithe) based poverty associated with zakat institutions, as it is the focus of this study. Zakat based poverty or had-al-kifayah considers expenditure of household in determining the minimum amount requires by household. Zakat institutions are organisations entrusted to collect and distribute zakat to the beneficiaries; utilised zakat-based poverty line to screen applicants for zakat fund distribution. Zakat based poverty line income is a variant of objective poverty. However, the multifaced nature of poverty should include subjective poverty approach for a more accurate identification of the poor and the needy. As such, the paper evaluates the three poverty approaches as discussed. Data were obtained from a survey of the applicants of zakat fund in the State Islamic Religious Council (SIRC) of Melaka, one of the states in Malaysia. Our findings revealed that there are significant differences between each approach in determining who the poor are. Poverty Line Income and zakat-based poverty reported a lower number of poor and needy compare to subjective poverty estimates. Subjective poverty approach if utilised will complement current approaches and enhance the identification of the poor and need.

Does Multifaceted Poverty Approach Enhance the Identification of The Poor and Needy in Zakat Institutions?