Author(s): Yusuff Jelili Amuda, Raagini Sama Sundaram, Krishnaaveni Muniandy, Sharmilla Vanarajah, Kartiyani Letchumanan
Takaful has been an effective mechanism for addressing different social challenges in predominant Muslim countries, Malaysia is an example. More importantly, takaful has grown in Malaysia to address different societal challenges. Literature posits that many students in Malaysian are faced with financial problem despite the fact many forms of incentives are provided by Government. Little attention is given to exploration of takaful surplus in helping the needy students in the country. Therefore, this paper primarily investigates the application of is takaful surplus as an Islamic financial instrument to empower the needy students in the country. Qualitative content analysis of existing literature is used as methodology of the paper. The result indicates that takaful plans can be applied to improve lifestyles of needy students in the country. It is further showed that takaful surplus as a financial instrument should enhance the conditions of needy students in Malaysia in order to fulfil the interest of needy students as an integral motive of Islamic financial institutions. In conclusion, it has been reiterated that takaful surplus is instrumental for solving financial challenges of needy students in Malaysia. It is therefore suggested that, action-oriented measures should be taken to ensure an effective application of takaful surplus to support needy students in order to make Islamic financial instrument respond to the social demands of Muslims as an integral part of making an existing takaful plan for students.