Bait-ul-Mal significantly contributes to poverty alleviation through its various projects, including providing assistance to the destitute, widows, orphans, invalids, and other needy persons in the society. It provides financial assistance to the needy with emphasis on rehabilitation.

When wealth collected was much more and there was no immediate item of expenditure the question of the income which was termed as the wealth of Allah Almighty was to be preserved at one central place which needed space and administration both for collection, distribution and taking care of the wealth so accumulated at a particular place and thus it took the form of an institution and was given the name of Baytul-Mal.