Answered by Shaykh Abdurrahman ibn Yusuf Mangera
Can a person who is sahib e nisab give the zakat to an Islamic educational institution – where the quran al karim etc are taught to students ( not necessarily all poor or miskeen) – can zakat be used to fund the education of poor students
In the name of Allah, the Inspirer of truth.
According to the Shariah, zakat cannot be given to an Islamic Educational Institute as a receiver, because that does not constitute transferring ownership to a legally-poor person, which is a condition for the validity of one’s zakat payment.
However, there are some institutes which accept zakat donations and act as an agent on behalf of the payer or the poor student. They hand it over into the possession of the poor student after which the student pays the amount as his tuition or fees back to the Islamic Institution. Now they are able to use it as they feel necessary.
And Allah knows best.
Abdur-Rahman Ibn Yusuf