Fatwas on Islamic Banking and Finance

Fatwas by the Egyptian Office of the Mufti – 1900- 1989

1. Subject: Prohibition of bank interest.
Question:
Is the use of Bank money permissible (Halal) or prohibited (Haram) ? Is what is taken of it for trade considered Riba or not (i.e are business loans taken from a bank at a fixed rate of interest considered to be Riba)?

Fatwa:
To take business loans from a bank at a fixed rate of interest, as is the custom now, is Riba which is altogether forbidden. Allah, the Almighty knows best.

Source:
Fatwas by the Egyptian Office of the Mufti, Supreme Council for Islamic Affairs; opinion given by Sheikh Bakri Al Sadafi, Egyptian Mufti, 27 MuharramMuharram is the first month of the Islamic calendar. It is one of the four sacred months of the year when warfare is banned. It precedes the month of Safar. The tenth of Muharram is known as Ashura, an important day of commemoration in Islam. 1325 A.H./1907 A.D.

2. Subject: Prohibition of investing deposited money for a fixed interest.

Question:
A person asks about the Shari’ah ruling on depositing the legacy of his deceased son’s two daughters in a bank for interest.
Fatwa:
Islamic law does not permit the investment of money in a bank at a fixed rate of interest because an investment such as this constitutes Riba which is prohibited by the Shari’ah.

Source:
Fatwa by Sheikh Abdel Majeed Saleem, Mufti of Egypt, 1348 A.H./ 1930 A.D
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3. Subject: Interest of bonds- is a prohibited Rlba.
Question:
If one inherits from his father Cotton Loan Bonds on which the government pays interest, is the interest accrued considered a prohibited Riba ?

Fatwa:
This interest is a type of Riba prohibited by Allah the Almighty in His Holy Book.

Source:
Fatwa by Sheikh Abdel Majeed Saleem, Mufti of Egypt, 1362 A.H.11943 A.D.

4. Subject: Taking interest for money deposited in banks is prohibited; it may not be given as alms

Question:
Is it permitted to take interest for money deposited in banks and give it as alms to the poor ?

Fatwa:
Taking interest for’ money deposited in banks constitutes Riba and is prohibited. Giving this interest as alms is unacceptable to Allah, the Almighty. He who does so has committed a sin.

Source:
Fatwa by Sheikh Abdel Majeed Saleem, Mufti of Egypt, 1362 A.H.I 1943 A.D.

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