Question :
A question was asked regarding [the validity of] benefiting from interest made through the bank.
Fatwa in Brief: This is not permitted. Clearly,
such interest is the result of riba, and [on
these grounds,] it is illegal to deal with banks.
Shaykh Ibn al-‘Uthaymin, Majmu‘ Durus wa Fatawa al-Haram
al-Makki, 3/386-390
Response:
It is permitted to accept interest gained on your money
in the bank. However, this interest should not be used
to benefit the individual; rather, it should be directed
towards projects that generally benefit Muslims.
Commentary:
Islam declared riba illegal. The most obvious
kind of riba occurs when someone takes out a
loan, upon which a specified amount of interest has been
agreed, so that s/he pays back this money in
installments, and over a prolonged period of time.
The prohibition of this kind of riba is clearly
stated in the Noble Qur’an and in the hadiths and
is the established consensus of the [Sunni] Muslim
Imams. Hence, God said:
“Those who swallow usury cannot rise up save as he
ariseth whom the devil hath prostrated by (his) touch.
That is because they say: trade is just like usury;
whereas God hath permitted trading and forbiddeth usury.
He unto whom an admonition from his Lord cometh, and
(he) refraineth (in obedience, thereto), he shall keep
(the profits of) that which is past, and his affair
(henceforth) is with Gody. As for him who returneth (to
usury) – Such are rightful owners of the Fire. They will
abide therein”. (Q. 2: 275)
Likewise, the Prophet (upon him be peace) said: “gold is
to be exchanged for [the same amount of] gold, and
anything extra is riba”. On the basis of this
evidence [the Qur’anic verse and hadith], the
prohibition upon any act of riba is firmly
established. Also, if money is put into a bank [or
similar institution], on the understanding that it will
accrue a specific amount of interest, then this must be
understood as a type of riba in Islam.
A Muslim should not benefit from, or use this interest,
as it has been gained illegally. However, a Muslim may
accept this interest if s/he channels it into a morally
worthy cause,[1]
such as the building of a mosque, a hospital, or s/he
dedicates it to the service of the poor, and so as to
follow the Sunna of the Messenger of God (upon him be
peace). Indeed, the Sunna directs us on what we should
do with illegally made profits, so that Muslims may
shoulder their responsibilities wisely.[2]
And God knows best.
Dr. Anas Abu Shadi
[1]
On this see Imam Ghazali, Ihya’ ‘Ulum al-Din,
pp. 882-3.
[2]
Shaykh Jad al-Haqq, Fatawa Dar al-Ifta’ al-Misriyya,
no. 1260, 5th Muharram 1402, 2nd
of November, 1981.