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The question

Is taking interest from banks that invest solely in real estate, agriculture, and industry considered similar to the story of the man who grew his employee's money?

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Source: FtawySummarized from the full answer at Ftawy · imported Sep 2, 20261 min readAlso available in العربية
The answer

The profits of interest-based banks are forbidden (haram) because they lend and borrow with interest, and they invest their money in forbidden (haram) ventures. Even if they were to invest their money in permissible (halal) ventures, the agreed-upon interest is a guaranteed percentage of the capital that does not change; it is a loan that draws a benefit, which is usury (riba). As for Islamic banks, their profit is a percentage of the actual profit that changes, with no guarantee of the capital. This constitutes an Islamic Mudarabah (partnership). The aforementioned Hadith cannot be used as evidence for what interest-based banks do, because it pertains to the law of those who came before us, and our law does not adopt it if it contradicts our own law.

Summarized from the full answer at Ftawy · imported

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Source platform
Ftawy
Original fatwa ID
50740
Imported
Translation status
Source text, unreviewed
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