Charity in its broadest sense has been called sadaqah in Islam. Such great importance is attached to charity that the month of Ramazan has been fixed for individuals to be trained in the practice of charity. It has therefore been made into an institution in order to give it permanence and regularity. The law of zakat takes from the wealthy and gives to the poor, rotates wealth in such a way as to balance social inequality.

Islamic law empowers the Islamic government or community to collect the zakat and to keep separate account of it. Zakat funds must be spent on the categories specified in the Quran in chapter 2 verse 177. Zakat funds basically are to be used for the social welfare of the people which includes education and other essential services.

There are two forms of charity in Islam—obligatory and voluntary, which are respectively called Zakat and Sadaqah. Zakat is from the verb Zakah, which signifies “to thrive”, “to be wholesome”, “to be pure”, meaning purification. Giving up a portion of one’s wealth, which is in excess of what one needs for one’s own sustenance, is a purifying process.