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Is it permissible to deal with usurious banks for the purpose of obtaining a large loan by exaggerating the price of the purchased land, in order to use it for charitable works?

1 min readAlso available in العربية

Dealing with usurious banks is impermissible, and the prohibition becomes more severe if the transaction itself is forbidden, such as informing the bank of a price other than the real price for the land or commodity the client wishes the bank to purchase for him if the transaction is murabaha. This is because any amount exceeding the land's price is considered a loan to the client, on which the bank charges interest, thus constituting forbidden usury. However, if the bank undertakes to pay the price the client informs it of as the price for the land, and then the bank collects it with interest, the entire transaction is usurious, in addition to involving deception and fraud. A good objective does not justify forbidden means, and ill-gotten wealth cannot be used to draw closer to Allah.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

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