Is the company's savings plan, with its two types (invested and non-invested), permissible in Islamic law?
There is no objection to deducting from an employee's salary with their consent, nor is there any objection to investing the deducted portion if the investment is based on legitimate Islamic principles. This means that the investor's profit should be a common share of the generated profit, while bearing the anticipated loss, and without guaranteeing the principal.
Therefore, the first type of investment mentioned in the question is impermissible because the profit margin is not specified, and the doubled amount deducted at the end of service constitutes usury (riba) of the pre-Islamic era (Jahiliyyah). As for the second type of saving, there is no harm in it, as it is akin to a deposit or a benevolent loan ().
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
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- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
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