In an industry first, IBF Net has launched a blockchain-driven project aiming to mainstream and institutionalize charitable and benevolent actions in the form of contribution assets and efforts through objective measurement and conversion into exchangeable tokens of value.
The project uses the Algorand protocol to build an integrated framework for the two types of Sadaqah, allowing project owners to raise both financial as well as human resources.
The platform is known as Benevolence and it facilitates financial donations as well as measures volunteering time — in terms of quantity and quality — and converts the same to tokens that may be monetized at the option of the volunteer. Simply put, it enables volunteering capital to be rewarded or remunerated at different rates and also optimizes the supply of such resources. Benevolence also promotes and celebrates benevolent actions through cash donations via the issuance of tokens.
The platform is designed to address several salient challenges within the charity crowdfunding space, namely: the lack of transparency with regards to utilization of funds, the lack of an objective measurement mechanism for volunteering hours and quality as well as the lack of adequate incentivization of such resources.
“This leads to some avoidable adverse outcomes. It makes the allocation of resources less efficient due to absence of reliable information on the quantity and quality of available resources in terms of human efforts,” explained IBF Net.
Studies by IBF Net highlighted a sizeable gap between potential mobilization of philanthropy-driven resources and their actual realization.
“Estimates place the global potential of Zakat funds alone in the range of US$550–600 billion. Actual Zakat collected stands at just about 2–3% of the same indicating the huge untapped potential. The potential of other forms of Islamic charity-driven resources is equally impressive. The gap between the potential and realized resources is equally huge too,” noted the start-up.
Benevolence is part of a larger project of IBF Net Group, whose goal is to ultimately build a “miniature Islamic economy by developing smart contracts to cater to three major parts in line with the trifurcation of the Islamic economy into philanthropy, not-for-profit and for-profit sectors”.