Contributions for the fund should come from members of the Organisation of the Islamic Conference, the world's biggest Muslim grouping, The Star reported on Saturday.
Malaysia is the current leader of the 57-member OIC.
The bank is the OIC's financial arm.
Syed Hamid said some Muslim countries were extending help to OIC countries facing problems, but the funds were not being channelled systematically.
"There is a perception that the OIC and Muslim countries are not lifting a finger to help," he was quoted as saying by The Star.
Syed Hamid also called for the establishment of an umbrella body for non-governmental organisations operating in OIC countries to coordinate aid efforts.
The minister was speaking on Friday after presenting a check for $500,000 to an account opened by the bank to help the West African nation of Niger, which is facing severe food shortages due to a drought and locust invasion last year.
The national news agency Bernama reported that Malaysia also plans to send a team of medical volunteers to Niger. Malaysian officials could not be reached on Saturday for comment.