According to Dewan Bahasa dan Pustaka, a scholarship is money given to a student to finance or help finance their studies.

Scholarships/allowances received by a student do not fall under the category of income wealth (al-Māl al-Mustafad) if the amount received is only sufficient to cover the cost of tuition and the student’s basic living needs.

However, if a student receives a scholarship/allowance that exceeds the cost of tuition and their personal living needs, the excess is considered income wealth. This excess should be assessed together with all other categories of income wealth owned and zakat becomes obligatory if it reaches the nisab.

Based on the Selangor State Zakat Collection Management System Fatwa 2017 (Amendment 2023), wealth based on the nisab of 85 grams of gold (gold that is not jewellery, savings, and investments) should be combined to determine whether the nisab is met.⁹

If a student saves the scholarship/allowance received and it reaches a one-year haul, the scholarship/allowance has transformed into savings assets. Zakat is then obligatory under Zakat on Savings, to be assessed together with other savings assets such as non-jewellery gold, investments, takaful savings, and the like.