When Secular Excellence Handles Sacred Obligation

What GiveDirectly's Zakat Program Reveals About Muslim Institutional Capacity

Since the early 2000s, non-Muslim humanitarian organisations have increasingly entered the field of zakat administration and distribution.

This article is about GiveDirectly, one of the most efficient organizations in the international development cash transfer ecosystem. Having worked in the humanitarian sector where I personally managed beneficiary families receiving cash transfers, studied international development economics, and worked in the broader international organization sphere, I am aware of their strong standing in the field.

In 2023, they piloted their first Zakat program in Yemen. This year, they have created a Zakat-compliant program in Mozambique. They’ve hired Shariah advisors, created meticulous policies ensuring 100% of Zakat reaches eligible recipients, and built policy on how to verify Muslim identity non-invasively. They’ve segregated funds, avoided riba, and ensured tamlik (transfer of ownership to correct recipients).

They’re doing everything right, operationally.

This article is not a recommendation of where or how to give zakat, as this is not what The Policy Minaret does. The purpose of this article is to serve as a case study on GiveDirectly’s model and pose questions regarding Muslim institutional development: What does it mean when a non-Muslim organization achieves operational excellence in handling one of Islam’s foundational pillars? And more importantly, what can we learn from GiveDirectly?

The Systems Question: What We’ve Lost

The GiveDirectly case becomes most interesting as a diagnostic tool for understanding what Muslim institutional development has lost over the years.

During the era of the Rightly Guided Caliphs, Zakat functioned as integrated public infrastructure. Trained collectors systematically assessed and collected from communities, distributed locally first according to all eight categories, and operated with accountability between caliphs, collectors, and communities. Under Uthman (RA), a distinction emerged between public wealth (livestock, crops, commercial goods) which remained systematically collected, and private wealth (gold, silver) which became individual responsibility, creating flexibility while maintaining oversight.

Today, the public dimension of Zakat, consisting of systematic collection and administration by community governance, has almost entirely disappeared save for some Muslim-majority countries.

What remains in the West consists of private giving which is mediated by organizations and optimized for relief delivery.

What’s lost:

• Community-level strategic allocation

• Local knowledge enabling verification and transformation

• Integration with community governance

• Social bonds strengthened through proximity

• Administrative wisdom adapting to needs

• Civilizational capacity to manage our own wealth redistribution

I spoke to Sheikh Sohail Hanif of NZF about this trend, and he observed that we’ve created “a low bar for anyone to enter.” When Zakat functions purely as a relief distribution, the distinction between Muslim and non-Muslim organizations becomes primarily operational rather than structural, and the spirituality behind it ceases to matter to the ordinary giver.

This isn’t any non-Muslim organization who deals with Zakat’s fault. They’re filling a vacuum. The question is: What would it take to rebuild systematic Zakat infrastructure? (Sheikh Sohail Hanif’s work at National Zakat Foundation UK is a good example on the local, as opposed to the humanitarian emergency, front).

What Muslims Can Learn: The Operational Excellence Gap

1. Long-Term Institutional Commitment

GiveDirectly has refined their methodology of unconditional cash transfers for over a decade, and their fraud reports show institutional learning: the 2021 fraud analysis led to systematic changes, and the 2024 risk reports show those changes working while identifying new challenges.

Many Muslim organizations lack this continuity. Leadership changes erase memory and donors chase trends based on emotions and popular media. As a result, organizations frequently change focus areas, launching new programs reactively to follow donor interest rather than deepening expertise in specific domains over decades.

The Learning: Rebuilding systematic Zakat infrastructure requires decade-plus institutional commitment with protected funding. This means:

• Waqf-based endowment models that free organizations from annual fundraising cycles chasing donor trends

• Leadership succession planning that preserves institutional knowledge across transitions

• Documented systems and processes that survive personnel changes

• Commitment to mastering specific domains (verification systems, transformation pathways, community governance) rather than constantly pivoting to new programs

• Measuring success by institutional capability development, not just annual donation totals

GiveDirectly spent over a decade refining cash transfer methodology while most international Muslim charities haven’t sustained focus on any single approach long enough to achieve comparable expertise. This is not to say that flexibility and adaptability is negative, rather it is a strength and is needed. What does deserve more attention is whether donors and boards will commit to funding the boring, unglamorous work of institutional development over decades, rather than chasing “this year’s crisis”, putting a band-aid on it, and then restarting the cycle once more.

2. Transparency as Default

GiveDirectly’s willingness to publish detailed mistakes and show systematic improvement builds trust that polished marketing never could.

I will suggest possible reasons as to why Muslim charities often remain opaque:

The Fitna Framing: Criticism of Muslim organizations is sometimes dismissed as causing division (fitna) or helping enemies of Islam. “Why are you airing our dirty laundry? This makes Muslims look bad.” This framing treats accountability as betrayal rather than stewardship.

Donor Trust Concerns: Organizations fear that admitting failures will cause donors to stop giving. “If we publish that X% of funds were misallocated, donors will think we’re incompetent and give elsewhere.” This creates incentive to hide rather than document problems.

Competitive Fundraising Dynamics: When multiple Muslim charities compete for the same donor pool, transparency becomes competitive disadvantage. The organization publishing fraud incidents loses donors to the organization publishing only success stories—even if both face similar challenges but only one is honest about them.

Cultural Face-Saving: In many Muslim cultural contexts, admitting institutional failure publicly is seen as shameful. It is better to handle problems quietly internally than expose them publicly, even if that means no institutional learning happens.

The “Trust Me Brother” Syndrome: In small communities, personal reputation substituted for documentation. “You know me. Trust me.” This is fine on a small scale, but it doesn’t scale. Institutional trust requires institutional transparency, yet many Muslim organizations still operate on personal trust assumptions despite serving thousands across continents.

Board and Donor Relationships: Many Muslim charities depend on a few major donors or have boards composed of major donors. Transparency about failures could threaten these relationships. It is much easier to show success to donors than to report: “Here’s how we failed this quarter and what we learned” (perhaps, this is where donors could be taught about wise practices as well).

The Result: Financial statements end up buried on websites (if they are published at all). Impact data remains vague or anecdotal (”thousands helped”). Failures are never documented publicly, and there is no systematic improvement because mistakes aren’t analyzed openly. When problems are discovered, they’re handled quietly rather than used as learning opportunities for the entire sector.

What GiveDirectly Demonstrates:

Radical transparency actually builds trust. GiveDirectly’s willingness to publish fraud incidents and operational challenges signals:

• We have nothing to hide

• We learn from mistakes systematically

• We respect donors enough to tell them the truth

• We’re confident enough to withstand scrutiny

Their fraud reports essentially say: “We’re trustees of donated funds. Here’s everything that went wrong. Here’s how we caught it. Here’s what we changed. Judge for yourself whether we handled the trust well.”

Donors who care about effectiveness are more likely to trust an organization that says “Here’s what went wrong and here’s what we changed” than one claiming perfection.

3. Evidence-Based Iteration

GiveDirectly uses randomized controlled trials (RCTs) and systematic data collection to understand what actually works, for whom, under what conditions—and then improves based on that evidence. This behaviour is continuous: implement, measure, analyze, adjust, repeat.

Why Many Muslim Organizations Don’t Do This:

In my observations, there are several possible factors that are preventing systematic evidence-based improvement in Muslim charitable institutions:

Measurement Feels Un-Islamic: There’s a sentiment that “we do this for Allah, not for metrics” or “our reward is with Allah, not in spreadsheets.” Measuring outcomes can feel like it diminishes the spiritual nature of giving or suggests we don’t trust that Allah will reward our efforts. This doesn’t mean quantitative-only metrics, but Muslims should think deeper on what this means qualitatively and spiritually as well.

Confusing Faith with Wishful Thinking: Many Muslim organizations assume that because their intentions are good and their work is “for Allah’s sake,” it must be effective. Questioning effectiveness feels like questioning sincerity, but in reality good intentions don’t guarantee good outcomes.

Evaluation Costs Money: Rigorous impact assessment requires resources such as staff time, external evaluators, and data systems. When donors want “100% to go to beneficiaries,” organizations feel they can’t justify fundraising or spending money to measure whether the beneficiary spending actually works.

Fear of Bad News: What if you measure and discover your flagship program doesn’t work? Better not to know and keep operating on assumption of effectiveness than to discover you’ve been wasting resources and have to admit it publicly.

No Institutional Capacity: Many Muslim organizations lack staff with evaluation expertise. They know how to deliver programs, raise funds, and manage operations—but not how to design studies, collect data systematically, or analyze outcomes rigorously.

The Result: Programs continue for years based on the assumption that they work, as opposed to evidence they work. When they fail, nobody knows in the first place because failure wasn’t measured. Organizations can’t distinguish between their effective programs and ineffective ones, so they keep doing everything the same way.

What Evidence-Based Iteration Actually Means:

This isn’t abandoning Islamic principles for Western metrics. This is operationalizing Islamic principles of ihsan (excellence) and amanah (stewardship).

The Prophet ﷺ said: “When one of you does something, Allah loves that you do it with excellence”. Excellence requires knowing whether what you’re doing works and improving based on that knowledge.

Classical Islamic scholarship modeled this approach. The development of fiqh (Islamic jurisprudence) was iterative: scholars examined what worked in practice, analyzed outcomes, consulted with communities affected by rulings, and refined their understanding over time. This was applying principles to reality and learning from results.

GiveDirectly doesn’t have perfect data on every outcome. But they measure systematically, learn from failures, and improve continuously, which is what Muslim institutions should strive to emulate.

4. Delivery and Donor Infrastructure

GiveDirectly distributes Zakat through mobile money transfers—a digital payment system operating via basic mobile phones without requiring bank accounts or smartphones. In Mozambique and similar contexts, this is often the only viable method for reaching extremely poor recipients in rural areas where banking infrastructure doesn’t exist.

Mobile money has become increasingly standard in international development, and many organizations, both Muslim and secular, use it for similar reasons. The operational logic is sound:

Traditional cash distribution creates multiple vulnerabilities: physical security risks for recipients traveling to collection points, opportunities for theft or interception, potential for local corruption in manual distribution, and dignity concerns when poverty becomes publicly visible through aid collection.

Mobile money solves these challenges. Recipients receive funds directly on a mobile phone, can access them at their convenience through a network of local agents, and maintain privacy about their circumstances. The digital trail also creates accountability so that both organization and recipients can verify that funds were received as intended.

GiveDirectly provides recipients with mobile phones and SIM cards where needed because it is considered essential infrastructure. Without a phone, recipients can’t receive the transfer. The phone becomes an asset they retain, enabling not just this transfer but future access to mobile money for other transactions, communication with family, and economic participation that was previously impossible. Recognizing that the tool enabling the transfer has value beyond the immediate transaction reflects a strong level of operational sophistication.

On the donor side:

While mobile money addresses delivery, there’s an equally important question about collection infrastructure: How easy is it for Muslims to actually give Zakat from wherever their wealth is held?

GiveDirectly accepts contributions via cash, wire transfer, stock, and mutual funds. Their non-Zakat programs accept even cryptocurrency and non-cash assets like land. This removes friction and allows donors to contribute from wherever their wealth is actually held rather than needing to liquidate first.

The question for Muslim institutions: Do we make giving equally frictionless?

Many Muslims hold significant wealth in stocks, real estate, mutual funds, retirement accounts, or other assets beyond cash. If Muslim Zakat organizations only accept bank transfers or credit cards, we’re creating unnecessary barriers.

This is not about whether GiveDirectly uniquely does something no Muslim organization does, since some Muslim charities do have sophisticated multi-asset infrastructure. The point is this should be standard practice as opposed to exceptional.

When we’re talking about rebuilding systematic Zakat infrastructure capable of managing $30+ billion annually across a global Ummah, the operational question becomes: Are we making it as easy to give Zakat as it is to invest in the stock market or buy a house?

If secular organizations can accept stock, crypto, and land donations, Muslim institutions managing one of Islam’s foundational pillars should match or exceed that operational sophistication. GiveDirectly demonstrates that infrastructure investments are not considered overhead that needs to be minimized, rather they are essential capabilities enabling effective operation at scale.

The learning: Build infrastructure on both sides. For delivery, invest in systems maximizing safety, dignity, and accountability for recipients—mobile money where appropriate, and other methods where better suited. For collection, accept Zakat from the diverse forms in which Muslim wealth is actually held, removing barriers between obligation and fulfillment.

The Framework Question: What “Impact” Means

GiveDirectly operates within a philosophical framework called effective altruism—a movement that applies evidence and reason to determine the most effective ways to benefit others. Effective altruism asks: “How can we help the most people with limited resources?”

At its core, effective altruism uses rigorous data to compare different charitable interventions and direct resources where they’ll have the greatest measurable impact. It’s why effective altruists might support malaria prevention in sub-Saharan Africa over local homeless shelters—mosquito nets save more lives per dollar spent. It’s utilitarian optimization applied to philanthropy: maximize welfare gained per dollar donated.

This framework has produced genuine insights. It’s pushed the charitable sector toward greater accountability, evidence-based decision making, and honest assessment of what actually works versus what feels good. GiveDirectly itself emerged from this movement—founded by economists testing whether direct cash transfers to the extremely poor could be more effective than traditional aid programs.

And GiveDirectly embodies effective altruism’s strengths:

They measure outcomes rigorously: How many recipients? What welfare improvements? What’s the cost per person helped? Their randomized controlled trials prove cash transfers work. Their efficiency metrics show exactly where money goes.

Tge catch is that they don’t reduce everything to cold calculations. Their GDLive platform shows individual recipients, documents their stories, shares photos and updates that humanize aggregate statistics. On the same platform, a real-time tracker lets donors see transfers happening. Their recipient story collection shares more personalized impact metrics from beneficiaries themselves.

This balance between rigorous metrics alongside human dignity demonstrates thoughtfulness about what “impact” means.

The Reality of Cash Transfers: What Actually Happens

Having monitored cash transfer programs in places like Ghana and Afghanistan over months, I’ve seen what the data and stories both show: Cash transfers can genuinely change lives, leading to real transformations. On the other hand, honest monitoring reveals another truth: they don’t always work. The reality is more nuanced than either “cash transfers are revolutionary” or “cash transfers are just relief” captures. They work transformatively for some recipients and provide crucial temporary relief for others. The difference often depends on factors beyond the cash itself—market access, family support structures, existing skills, community dynamics, timing.

This honest assessment matters because it reveals what cash transfers can and cannot accomplish:

What cash transfers do excellently:

• Provide immediate relief to those in extreme poverty

• Respect recipient agency (they choose how to use funds)

• Avoid paternalistic “we know what you need” approaches

• Work transformatively when recipients have the context to invest effectively

What cash transfers struggle with:

• Creating transformation when structural barriers (lack of markets, infrastructure, skills) persist

• Building community institutions that serve beyond individual recipients

• Addressing needs that require sustained relationship and long-term support

• Strengthening social bonds within communities (transfers from distant donors to distant recipients create no local accountability or relationship)

This doesn’t diminish cash transfers’ value, but it clarifies their role. They’re a powerful tool for poverty alleviation, particularly for those who have capability but lack capital. They’re less effective as the sole intervention for those facing multiple structural barriers or for communities needing institution-building beyond individual support.

What Islamic Frameworks Add

When I discussed with Sheikh Sohail Hanif regarding the bigger picture, he highlighted a point we often overlook: “If poverty relief is about alleviating concern, fear, and anxiety, and not just maximizing consumption, then Zakat should not be tied purely to exchange rates and effective altruism metrics.”

Islamic Zakat frameworks ask something different from effective altruism’s question. Not “How can we help the most people with limited resources?” but rather: “How do we fulfill our obligations to Allah while building community capacity and transforming both giver and receiver?”

Neither framework is wrong, it’s just that they’re answering fundamentally different questions with different priorities.

Effective altruism treats all recipients as equivalently worthy, optimizing purely on need severity and cost-effectiveness. A struggling family in London and a struggling family in rural Mozambique are evaluated by the same metric: Which intervention produces more welfare per dollar?

Islamic frameworks layer in additional considerations rooted in faith and spirituality that effective altruism doesn’t capture:

Relationality: Your family, neighbors, and community members aren’t one of many recipients among equals. They have distinct rights because of their relationship to you. Supporting your struggling neighbor has value beyond the welfare gain to that individual; it strengthens social bonds that benefit the entire community. The effective altruist asks “where does my dollar help most?” The Islamic framework asks “who has rights upon me because of our relationship”, and then spiritual benefits and rewards follow.

Virtue: Supporting those who will strengthen the Ummah has distinct value. A scholar who needs support to serve the community, a student studying Islamic sciences, and an organization building institutions are blessed recipients not for need severity but for their role in community development. My monitoring showed that the families who succeeded with cash transfers often had someone in their network—a community leader, a local imam, a neighbor with business experience—who could advise them. Community capacity matters for individual transformation.

Transformation: The goal isn’t to just alleviate current poverty, but to go one step further to create pathways out of poverty. This is where my monitoring became most instructive: cash transfers worked transformatively when combined with other forms of support—access to markets, skills mentoring, community networks, and sustained relationships. The woman with the sewing machine had a mentor who taught her business basics. The Afghan student had support and guidance from his community. Transformation requires more than cash alone.

Institution-Building: Supporting scholars, schools, mosques, and Islamic infrastructure serves future generations, as opposed to just current needs. This is one of the eight Zakat categories according to contemporary scholars (fi sabilillah), yet it’s challenging to measure on short-term impact metrics that effective altruism prioritizes. In both Ghana and Afghanistan, the communities with stronger institutions—functioning mosques, community centers, local leaders—had better outcomes from cash transfers because recipients had support structures. Institution-building creates the context in which individual interventions succeed.

Community Bonds: The “inefficiency” of local giving—knowing recipients personally, building relationships, and maintaining accountability through proximity—may be the entire point. In my monitoring, I noticed: recipients who had relationships with donors or local intermediaries used funds more thoughtfully, faced less pressure to misallocate, and had someone to turn to when challenges arose. Relationship matters for accountability and sustained support.

Spiritual Transformation: Both giver and receiver are transformed by Zakat. The wealthy learn humility. The poor maintain dignity through rights rather than charity. The community strengthens through bonds of mutual obligation. These transformations don’t show up in consumption metrics but matter immensely in Islamic understanding.

This means that when Muslim institutions rebuild Zakat infrastructure, we need metrics capturing what we actually value:

• Are communities becoming more resilient and self-sustaining?

• Are recipients moving from receiving to giving over multi-year periods?

• Are institutions being built that will serve for generations?

• Are scholars and students being supported to strengthen community knowledge?

• Are social bonds between rich and poor strengthening?

• Are both givers and receivers being spiritually transformed?

These are much harder to measure than “dollars delivered per dollar spent.” That doesn’t make them less important.

Learning From GiveDirectly’s Approach

GiveDirectly recognizes that numbers alone don’t capture full impact. Their combination of rigorous RCT evidence, real-time financial transparency, individual recipient stories, long-term follow-up studies, and public documentation of failures demonstrates sophistication. They live their values in real time, in front of everyone to see.

They have moved past the point of reducing recipients to data points—they’re using multiple methods to understand outcomes. They prove transparency, evidence, and efficiency are achievable while maintaining human dignity.

The learning for Muslim institutions: We can adopt this multi-dimensional approach of transparency, evidence-based improvement, honest documentation of failures, and a blend of data and human stories, while ensuring our metrics reflect Islamic priorities.

Both frameworks have something to teach us. Effective altruism pushes us toward rigor, measurement, and accountability. Islamic frameworks remind us that not everything that matters can be easily measured, and that obligations, relationships, and spiritual transformation are real forms of impact even when they resist quantification.

The sophisticated approach requires nuance and is not a decision on choosing one framework over the other. It’s learning from effective altruism’s methodological rigor while ensuring the metrics we optimize for reflect Islamic values and the full civilizational purposes Zakat was designed to serve.

GiveDirectly has shown that operational excellence in poverty relief is achievable. The challenge is building Muslim institutions that achieve similar excellence while serving the full breadth of Zakat’s purposes: not just humanitarian poverty relief on the interntional level, which is genuinely valuable and often transformative—but also community strengthening, institution-building, and the sustained relationships that turn temporary relief into lasting transformation.

What Happens Without Systems

When Zakat becomes atomized individual giving rather than community administration, who decides allocation? Each donor makes isolated choices based on marketing or emotion.

This results in hard-to-market categories (scholars, institutions, debt relief) getting neglected and emotional categories (emergency relief) being served in a scattered way. GiveDirectly operates primarily in Zakat categories 1-2: the poor and needy. They’re exceptional at this. Their model isn’t designed for supporting scholars or building institutions.

In a world with functioning Muslim Zakat systems, this would be fine. GiveDirectly would be one tool available to administrators allocating strategically. In our actual world—where systematic administration has collapsed—donors using their platform exclusively aren’t addressing other categories.

The learning: As Muslim communities rebuild systematic infrastructure, organizations like GiveDirectly can be valuable partners for specific functions (their operational excellence in poverty relief is genuine). But, they’re best understood as components within a larger system, not as the system itself.

A comprehensive system might partner with organizations like GiveDirectly for poverty relief delivery in order to learn, whilst maintaining separate structures for scholar support, institution-building, and strategic coordination across all eight categories.

Making an Informed Choice

For Muslims considering where to allocate Zakat:

Understand what GiveDirectly does excellently:

• Poverty relief through cash transfers to extremely poor recipients

• Operational rigor, transparency, accountability

• Shariah compliance through dedicated procedures

• Evidence-based approach with documented impact

Understand what GiveDirectly doesn’t do:

• Community-level systematic administration across eight categories

• Local institution-building or scholar support

• Transformation pathways requiring long-term relationship

• Social bond strengthening in your community

Consider a balanced allocation: Some Muslims might allocate percentages to extreme poverty relief, local community needs, and broader Ummah support—adjusting based on annual assessment.

The goal: Ensure Muslims make choices based on genuine understanding rather than defaulting to easiest options.

Visit GiveDirectly’s Zakat program to learn more and make your informed decision.

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A Note on This Analysis

The fact that GiveDirectly commissioned this analysis and provided complete editorial freedom reveals their organizational culture. Many organizations would never commission potentially critical examination. They’d seek validation, and not be welcome to an honest assessment.

GiveDirectly’s willingness to fund independent analysis that might raise difficult questions demonstrates (in my eyes) their institutional maturity: they have the confidence to invite examination, the transparency to provide me access to their resources about the program, and the intellectual honesty to learn from critique.

This is what Muslim organizations should aspire to: a willingness to be examined, commitment to learning, and confidence that honest assessment ultimately serves mission better than defensive marketing.

This doesn’t resolve all questions, but it demonstrates the culture that makes genuine excellence possible, shown through GiveDirectly’s organisational culture and behaviour.

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For more information: https://www.givedirectly.org/zakat2026/

This analysis was commissioned by GiveDirectly with full editorial independence. All views, analysis, and recommendations remain solely those of the author.