Is it permissible or forbidden to get a job in a company that requires a bank guarantee to enter a bid, and is there an alternative to that?
An uncovered letter of guarantee is a bank's surety for a client, and therefore it is impermissible to charge a fee for it, because surety (kafalah) is a gratuitous contract, and because it may lead to falling into usury (riba). If the guarantor (kafil) pays on behalf of the guaranteed (makful), that is a loan, and the fee for the guarantee is interest on the loan, which is usury. Scholars have unanimously agreed on the impermissibility of charging a fee for surety (hamalah/kafalah). The Islamic Fiqh Academy holds that it is not permissible to charge a fee for a letter of guarantee in return for the guarantee process itself, whether it is covered or uncovered. However, administrative expenses for issuing it are permissible at the customary rate (ajr al-mithl). The First Conference of Islamic Banking in Dubai stipulated that a letter of guarantee involves two matters: agency (wakalah) and surety (kafalah). It is impermissible to charge a fee for surety, but it is permissible to charge a fee for agency that covers the costs and banking services related to the project.
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- Original fatwa ID
- 16612
- Imported
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