Variables Determining Muzaki Loyalty in Paying Zakat, Infaq and Sadaqah at Zakat Institutions in Indonesia

This study aims to find out, test and analyze: (a) the effect of transparency on muzaki beliefs; (b) the effect of transparency on muzaki loyalty; (c) the effect of accountability on muzaki’s trust; (d) the effect of accountability on muzaki loyalty; (e) the effect of trust on muzaki loyalty in paying zakat, infaq, and almsgiving at the Amil Zakat Institution in Indonesia. This type of research is explanatory research and using survey method. Data collection technique used was questionnaire containing written questions answered by respondents, namely muzaki (payer of zakat, infaq and sadaqah) at amil zakat institutions. The sampling technique used was purposive sampling, which set the samples based on criteria. The data analysis technique in this study used the Partial Least Square (PLS) approach. PLS is a model of Structural Equation Modeling (SEM) based on components or variants. The results of the study found that (a) accountability has a significant positive effect on muzaki’s trust; (b) transparency has a significant positive effect on muzaki’s trust; (c) accountability has a significant positive effect on muzaki loyalty; (d) transparency has a significant positive effect on muzaki loyalty; (e) trust has a significant positive effect on muzaki loyalty in paying zakat, infaq, and almsgiving at the Amil Zakat Institution in Indonesia. The results of this study suggest that zakat management organizations increase the loyalty of donors in paying zakat by increasing donor’s trust by improving transparency and accountability of audited financial reports and in accordance with PSAK 109.


Introduction
Zakat is worship that is found in the third pillar of Islam. In Law no. 23 of 2011 zakat is a religious institution that aims to improve justice and public welfare. Zakat as an instrument for poverty alleviation has many advantages over conventional fiscal instruments that now exist. First, the use of zakat is clearly determined in the Sharia (QS. At Tawbah: 60), where zakat is only for 8 groups (ashnaf), namely: indigent people, poor people, amil (board of) zakat, mu'allaf (Muslim convers), slaves, people who are in debt, jihad fi sabilillah (Jihad in the Path of Allah), and ibn sabil (travelers in need). Jumhur fuqaha (majority of experts in Islamic law) agree that people outside these 8 groups are not lawful to receive zakat.
The rapid growth of the Zakat Management Organization in the midst of the existing large potential of zakat is a good first step to improve the management of zakat. Baker & Chaider (2006) state that the potential of zakat in Indonesia reaches IDR 19.3 trillion. This amount consists of IDR 5.1 trillion in goods and IDR 14.2 trillion in cash. In addition, the results of a survey conducted by the Public Interest Research and Advocacy Center (PIRAC) state that the potential of zakat in Indonesia increased from IDR 4.45 trillion in 2004 to IDR 9.09 trillion in 2007. Fakhruddin in (Ramandhita, 2012) also mentions that in the latest BAZNAS study in 2011, the potential of national zakat reached IDR 217 trillion consisting of IDR 82.7 trillion potential household zakat, IDR 2.4 trillion potential of BUMN (state-owned enterprises) zakat, and IDR 17 trillion potential savings zakat. Based on research data from BAZNAS Indonesia in 2016, the potential of zakat reached IDR 286 trillion.
The condition of the large potential of zakat encourages the growth and development of zakat management organizations in Indonesia, both managed by the community and the government. Since the issuance of Law No. 38 concerning Management of Zakat in 1999 and the new zakat law that has been ratified since 2011, namely Law No. 23 of 2011 concerning Management of Zakat, until now there are 180 Amil Zakat Institutions (LAZ) registered as members of FOZ, in addition to hundreds of Amil Zakat Agencies (BAZ) managed by the government, and not to mention the presence of other amil zakat institutions that have not been registered in FOZ and BAZ members.
The purpose of zakat management for zakat organizations based on Law Number 23 Year 2011 is to increase the effectiveness and efficiency of services in the management of zakat and the benefits of zakat to realize public welfare and poverty reduction by providing a good governance system in the form of transparency, accountability and cleanness. This attempt will certainly have a positive impact on mustahiq, muzaki and the zakat organization itself.
The existence of a large gap between the potential of zakat and the amount of zakat collected and distributed invites many questions, given the large number of Zakat Management Organizations and the amount of government attention in dealing with the issue of zakat. The low ratio of zakat collection in Indonesia is caused by several factors, including: (a) the government has not implemented a system of accreditation and public accounting standards for Amil Zakat Institutions so that there is no definite standard for each Amil Zakat Institution in reporting its overall performance and financial report so that the transparency level of the Amil Zakat Institution is still weak; and (b) the results of a survey conducted by PIRAC in 2007 stated that there was a decrease in the distribution of zakat by muzaki to the Amil Zakat Agency and Amil Zakat Institution from 9% and 1.5% in 2004 to 6% and 1.2% in 2007. One of the contributing factors is the decline in public trust in zakat managers, both the Amil Zakat Agency and the Amil Zakat Institution (PIRAC, 2007: 2).
The above opinion is further strengthened by a national survey conducted by Syarif Hidayatullah State Islamic University, Jakarta. The survey showed that 97% of people wanted LAZ to work accountably and transparently, 90% asked for easy access to control of managed funds, 90% demanded the publication of financial reports in the mass media. Furthermore, 88% of the people felt the need for data collection of donors. In addition, 75% of the community do not want to distribute zakat to zakat institutions whose accountability is less well known. In fact, 63% of the people want to know where and how to give.
However, in line with the increasing public expectation of zakat collection and the development of amil zakat (LAZ) institutions, there are several things that hinder the realization of zakat. One of them is the problem of lack of understanding about zakat itself and the lack of trust in zakat organizers. What is meant by understanding is the community (Muslims) knowledge about LAZ or the Amil Zakat Agency, which is very limited compared to their knowledge about prayer and fasting. Meanwhile, the growing awareness of the Islamic community about the implementation of zakat leads to lack of trust in the organizers of zakat itself. This attitude is addressed to people or groups of people or amil zakat or other institutions. Therefore, a good organization is needed, especially the system the administration, in presenting transparent and relevant financial reports on zakat as well as good supervision. In this case, bookkeeping is very important and helpful for users of financial statements of zakat management organizations.
The amil zakat institution is a non-profit institution that aims to help Muslims distribute zakat, infaq, and sadaqah to those who are entitled. These activities involve several interrelated parties namely the zakat provider, manager, and recipient of zakat. In some cases, fund managers are not people or institutions that are truly known to funders. This, like other public institutions, raises the need for accountability. The zakat provider wants accountability for the integrity, efficiency and effectiveness of the funds they submit. Employees want the institution to grow and develop in accordance with its commitment to the ummah. The management agency wants the trust of the funder. Fund recipients want transparency in fund management.
According to the results of research conducted by Yulinartati et al. (2013), by the increase in the potential of zakat each year, it is expected that the service quality of amil zakat institutions will also increase. By providing services to those who need information such as prospective muzaki, muzaki and other parties who need other information through the improved services, such as transparency and accountability, it is expected that they are confident and trustworthy. Thus, both Muzaki and prospective Muzaki are confident and loyal to channel their zakat funds to the amil zakat institution Transparency means the availability of sufficient, accurate, and timely information about public policy, and its formation process. Transparency is built on the basis of the freedom to receive information obtained by the public. Information relating to public interests must be directly obtained by those in need. To maintain objectivity in carrying out its activities, an organization must provide material and relevant information in a way that is easily accessible and understood by stakeholders.
Public accountability/accountability of zakat management organizations is an absolute thing that must be done by zakat management organizations. This is because zakat management organizations are public institutions that are bound by the public rules they follow, namely adhering to the principles of Good Corporate Governance (CGC). Awareness of the zakat managers on this problem for the present time is very absolute. Unfortunately, many zakat management organizations have not made reports that are in accordance with the accounting standards applicable in Indonesia.
From the details above, we can see that the main factor that causes the low optimization of zakat is the low level of public trust in the quality of zakat management by the Zakat Management Organization and the Amil Zakat Institution. A sense of lack of trust in amil zakat makes muzaki (zakat payers) prefer to calculate and distribute their own zakat. This lack of trust is driven by the public view of the accountability and transparency of the Zakat Management Organization. The community considers that OPZ accountability and transparency are still low. In fact, by distributing zakat through Zakat Management Organizations, the level of accuracy of the distribution of zakat to mustahiq (zakat beneficiary) is better than that by the individual distribution of zakat, where muzaki sometimes misinterprets who has the right to receive zakat.
The optimization of zakat collection will be achieved if the Zakat Management Organization is able to ward off the doubts of the muzaki regarding the quality of zakat management in the Zakat Management Organization. One way to improve the quality of transparency and accountability services is by financial statements.
Based on the description above, the author took the initiative to conduct research on (a) whether transparency has an effect on Muzaki's trust in paying zakat funds, infaq, and almsgiving at the Amil Zakat Institution in Indonesia; (b) whether transparency has an effect on muzaki loyalty in paying zakat, infaq, and alms funds at the Amil Zakat Institution in Indonesia; (c) whether accountability affects the trust of muzaki in paying zakat, infaq, and alms funds at the Amil Zakat Institution in Indonesia; (d) whether accountability affects the loyalty of muzaki in paying zakat, infaq, and alms funds to the Amil Zakat Institution in Indonesia; and (e) whether trust affects the loyalty of muzaki in paying zakat, infaq, and alms funds at the Amil Zakat Institution in Indonesia. This study is different from previous research conducted by Wijaya (2011) although the dependent variable is the same, namely donor loyalty. In this study, increasing trust as an intervening variable. So that the research model is also different, and the data analysis technique uses PLS while in his research Wijaya (2011) used multiple regression.
This research aims to find out, test and analyze the effect of transparency on Muzaki's trust in paying zakat, infaq, and sadaqah to Amil Zakat Institution in Indonesia, the effect of transparency on Muzaki's loyalty in paying zakat to Amil Zakat Institution in Indonesia, the effect of accountability on the Muzaki's trust in paying zakat, infaq, and almsgiving to Amil Zakat Institution in Indonesia, the effect of accountability on the Muzaki's loyality in paying zakat, infaq, almsgiving to Amil Zakat Institution in Indonesia, and the effect of trust in Muzaki's loyalty in paying zakat, infaq, and almsgiving to Amil Zakat Institution in Indonesia.

Literature Review Sharia Enterprise Theory
Enterprise shariah theory balances egoistic values with altruistic values, material values with spiritual values and individual values with jama'ah. In Islamic sharia, this form of balance is concretely manifested in one form of worship, namely zakat (Triyuwono, 2001). The consequence of this e q uilibrium value causes t he enterprise sharia theory to concern o n not only individual i n te r ests (in this case shareholders) but also other parties. Enterprise shariah theory has a broader range of accountability compared to entity theory. Accountability means responsibility toward God, humans, and nature (Triyuwono, 2001).

Zakat Management Organization
Zakat Management Organization (ZMO) is an institution that is tasked with managing zakat, infaq, and shadaqah, formed either by the government such as BAZNAS or by the community and protected by the government such as LAZ.

Conceptual Framework
Based on studies of various theoretical and empirical references, a conceptual framework can be formulated as a reference in this empirical research as shown. Figure 1 shows the latent variables to examine, consisting of four variables each of which is taken from three indicators. The names of variables and indicators are explained after the conceptual figure below.

Research Hypothesis
The research hypotheses are as follows: H1: Accountability affects Muzaki's trust in paying zakat, infaq, and shadaqah at Amil Zakat Institutions in Indonesia H2: Accountability affects Muzaki's loyalty in paying zakat, infaq, and shadaqah at Amil Zakat Institutions in Indonesia H3: Trust affects Muzaki's loyalty in paying zakat, infaq and shadaqah at Amil Zakat Institutions in Indonesia H4: Transparency affects Muzaki's trust in paying zakat, infaq, and shadaqah at the Amil Zakat Institution in Indonesia H5: Transparency affects Muzaki's loyalty in paying zakat, infaq, and shadaqah at Amil Zakat Institutions in Indonesia.

Methods
This type of research is explanatory research, which explains the causal relationship between research variables and hypothesis testing. This study used survey method, carried out to obtain facts about the phenomena that exist within the object of research and seek information in an actual and systematic manner. The data collection technique applied was questionnaires containing written questions answered by respondents, namely muzaki (zakat payers), infaq and sadaqah at amil zakat institutions. They were selected according to certain criteria. The samples were selected using purposive sampling, which set the samples based on criterias, namely (a) becoming muzaki at the amil zakat institution for a minimum of three years and (b) legality of the amil zakat institution, establishment of the organization and services in zakat funds, infaq and sadaqah management.
The data analysis technique in this study used the Partial Least Square (PLS) approach. PLS is a model of Structural Equation Modeling (SEM) based on components or variants. According to Ghozali (2006), PLS is an alternative approach that shifts from a covariant-based SEM approach to variant based. Ghozali (2006:19) states that the formal PLS model defines the formation variable is linearly aggregated from its indicators. The value estimation used to create variable score components was based on the specifications of the inner model and outer model. Hypothesis testing was done by carrying out the following steps. First, the outer model with reflective indicators were evaluated based on the substantive content, that is by comparing the relative value and seeing the significance of these values. Second, the inner model was evaluated by taking into account the percentage of variance explained, namely by looking at the value of R2 for endogenous constructs and also looking at the magnitude of the structural path coefficient. The significance of influence was evaluated using statistical t-test. Changes in the value of R2 can be used to assess the effect of certain exogenous variables on endogenous variables, that is whether the variable has a substantive effect.

Results and Discussion
Outer Model Analysis Outer model analysis is used to determine the relationship between latent constructs and indicators where each indicator explains the latent construct. The following is the outer model figure:

Figure 2. Outer Model
After analyzing the outer model, the value of indicators on each variable is above 0.7, so there is no need for a re-analysis. The relationship between latent variables and their indicators requires a loading score (outer loading) greater than 0.7 (>0.7), according to Hair et al., (1998) in (Jogiyanto & Abdillah, 2015), 184 that PLS requires a loading score (outer loading) indicator for each latent variable which should be >0.7.
Analysis of the outer model was done through discriminant validity, average variance extracted (AVE), and composite reliability.

Discriminant Validity
It is used to test whether the indicators in a construct have the greatest correlation to the constructs formed rather than correlations on other constructs. Discriminant validity is assessed based on cross loadings between indicators and their constructs. If the construct indicator correlation has a higher value than the correlation of the indicator to another construct, the construct is said to have high discriminat validity. The results of cross loadings can be seen in the following  Table 1 shows that the value of the cross loadings indicator for each construct is greater than that of the cross loadings indicator with other constructs. Thus, it can be said that all constructs have a high validity discretion.

Average Variance Extracted (AVE)
It is another measurement of discriminant validity, that is by looking at the value of AVE. The construct of the research model is considered valid if the value of AVE >0.5 (Jogiyanto & Abdillah, 2015). AVE results can be seen in the following table. The above results show that the AVE value of each construct is >0.5. Thus, it can be said that all constructs have high discriminant validity.

Composite Reliability
It is used to see the consistency of the indicators that measure constructs. A construct is said reliable or consistent if it has a reliability composite value >0.7 (Ghozali, 2006). The composite reliability results can be seen in the following table. Based on the above results of the output, each construct has a composite reliability value greater >0.7. So, it can be concluded that each construct has a high reliability value.

Path Analysis
Path analysis shows the levels of effect of exogenous constructs on endogenous constructs and the significance of the study. Path analysis results are seen from the structural path coefficients and t-values for the significance of the prediction model. The hypothesis in this st u dy is a two-tailed hypothesis with an error rate of 5%, so that th e t-table is 1.96 (Ghozali, 2006). Thus, a relationship is said to be influential if t-statistics >t-table. The results of the path coefficients can be seen in the following table. Sumber: Output SmartPLS The first hypothesis states that accountability has a positive significant effect on trust. From Table 4, it can be seen that t-statistics for the construct of accountability for the trust construct is greater than t-table, which is 6.356 > 1.96 and the parameter coefficient is positive at 0.520 because t-statistic is greater than t-table. It means that the construct of accountability has a statistical effect on the construct of trust. Furthermore, the positive parameter coefficient number indicate that the relationship between AK and KP is positive. Based on the results of these data, it is stated that accountability has a positive effect on Muzaki's trust. The results of this study are supported by the study conducted by Nugraha (2019) which states that accountability has a significant positive effect on muzaki' trust. The results of hypothesis testing (H1) have provided evidence that there is a significant positive effect between accountability and muzaki's trust.
The second hypothesis states that accountability has a positive effect on Muzaki's loyalty in performing zakat. From Table  4, it can be seen that t-statistic for the construct of accountability for the construct of loyalty muzaki in performing zakat is greater than t-table, which is 6.298 > 1.96 and the parameter coefficient is positive at 0.604. Because t-statistics is greater than t-table, it means that the construct of accountability has a statistical effect on the construct of muzaki's loyalty in performing zakat. Meanwhile, the positive parameter coefficient number indicates that the relationship between AK and L is positive. Based on the results of the data, it is found that accountability has a significant effect on muzaki loyalty. The results of this study are supported by research by Jumaizi (2011) which states that accountability has a significant effect on muzaki's loyalty. The results of testing hypothesis 2 have provided evidence that there is a significan, positive influence between accountability for muzaki's loyalty.
The third hypothesis states that trust has a positive effect on loyalty to pay zakat. From table 4, it can be seen that t-statistic for the construct of trust in the loyalty construct is greater than t-table, which is 2.104 > 1.96 and the parameter coefficient is positive at 0.197. Because t-statistic is greater than t-table, it means that the construct of trust has a statistically significant effect on the interest construct of loyalty to pay zakat. Meanwhile, the positive parameter coefficient number indicates that the direction of the relationship between KP and L is positive. Based on the results of these data, it is stated that trust has a significant effect on muzaki's loyalty. The results of this study are supported by the research by Widiyanto (2007) which states that trust has a significant effect on customer loyalty.
The fourth hypothesis states that transparency has a positive effect on trust. From table 4, it can be seen that t-statistics for transparency constructs of trust constructs is greater than t-table, which is equal to 2.503 > 1.96 and the parameter coefficient is positive at 0.284. Because t-statistics is higher than t-table, it means that the construct of transparency has a statistically significant effect on the construct of trust. Meanwhile, the positive parameter coefficient number indicates that the direction of the relationship between TR and KP is positive. Based on the results of these data, it is stated that transparency has a significant effect on muzaki's trust. The results of this study are supported by Nasim & Romdhon's (2014) study which states that financial report transparency has a significant effect on the level of muzaki's trust.
The fifth hypothesis states that transparency has a positive effect on loyalty. From table 4, it can be seen that t-statistic for the construct of transparency to the construct of loyalty is greater than t-table, which is 2.745 > 1.96 and the parameter coefficient is positive at 0.236. Because t-statistic is the same as t-table, it means that the transparency construct has a statistically significant effect on the construct of loyalty. Meanwhile, the positive parameter coefficient number indicates that the direction of the relationship between TR and L is positive. Based on the results of these data, it is stated that transparency has a significant effect on muzaki's loyalty. The results of this study are supported by research by Jumaizi (2011) which states that transparency has a significant effect on muzaki loyalty. R-Square R-Square function is to show the ability of exogenous variables in explaining endogenous constructs. The higher the value of R-Square, the greater the ability of the exogenous construct to explain the endogenous construct (Ghozali, 2006). The R-Square results can be seen in the following table. The above results indicate that the value of the R-Square construct of trust is 45%. This means that the accountability construct is able to explain trust by 45%, while the remaining 55% is explained by other variables. The above results also show that the R-Square value of the construct of loyalty is 75%. This means that trust constructs can explain loyalty constructs by 75%, while other variables explain the remaining 25%.

Conclusion
The results show that transparency has a significant positive effect on muzaki's trust in paying zakat, infaq, and sadaqah to Amil Zakat Institution. Hence, if the quality of transparency is improved well in management at Amil Zakat Institution, it will have a very positive impact on the trust of zakat payers (muzaki) to Amil Zakat Institution. Transparency has a significant positive effect on muzaki's loyalty in paying zakat, infaq, and sadaqah to Amil Zakat Institutions. If Amil Zakat Institution improves the principles of transparency or the quality of transparency in management well, it will have a very positive impact on zakat payers (muzaki) to Amil Zakat Institution. Accountability has a significant positive effect on muzaki's trust in paying zakat, infaq, and sadaqah to an Amil Zakat Institution. Therefore, if accountability is applied or the quality of management accountability at the Amil Zakat Institution is improved well, it will be able to have a very positive impact on the trust of zakat payers (muzaki) at the Amil Zakat Institution. If an Amil Zakat Institution applies the principles of accountability properly to its management, it will be able to have a very positive impact toward the zakat payers (muzaki).
Trust has a significant positive effect on muzaki's loyalty in paying zakat, infaq, and sadaqah at the Amil Zakat Institution. If the quality of trust given by muzaki to the institution is really wellmaintained or improved by the Amil Zakat Institution, it will be able to have a very positive impact on the loyalty of zakat payers (muzaki) at the Amil Zakat Institution.
The results of the study recommend that the management of the Amil Zakat Institution needs to increase transparency and accountability by improving financial statements in accordance with PSAK 109. Therefore, financial reports issued by amil zakat institutions should be audited by internal and external auditors since funds managed by zakat institutions belong to muzaki who entrusts their fund management to zakat institutions. Thus, the muzaki and prospective muzaki are convinced of their decision to pay their zakat funds towards this institution. Thus, the Amil Zakat Institution can maintain and increase the number of zakat payers (Muzaki) and compete with other amil zakat institutions.