Internal Factors Affecting the Intention to Pay Zakat and the Selection of Formal Zakat Institutions on Generation Y in Indonesia

Abstract

Keywords: Zakat, Consumer Behaviour, Religiosity, Generation Y, Altruism. Abstract: This research aims to invistigate and analyze the internal factors affecting intention to pay zakat and the selection of formal zakat institutions on Generation Y in Indonesia. The object of this study was Generation Y (22-40 years old) in Indonesia and obliged to pay zakat with the number of samples taken were 100 respondents. The sampling technique used was purposive sampling and Structural Equational Model-Partial Least Square (SEM-PLS) with SmartPLS version 3 as the tool for data analysis. The results showed that religiosity and susceptibility to interpersonal influence has a positive and significant effect on the intention to pay zakat. Altruism has a negative and significant effect on the intention to pay zakat. Intention to pay zakat has a positive and significant effect on the selection of formal zakat institution on Generation Y in Indonesia Implications for the future direction, the government and zakat institutions is expected to create public awareness and a policy to improve zakat activity. This activity should be supported by zakat distribution facilities such as the Zakat Collector Unit in government and private institutions.