Is it permissible for an employee in the Directorate of Social Welfare, whose task is guidance and awareness, to continue in his work after being assigned to provide loans to needy families, which include a clause for deducting a 3% "legal interest" in advance, knowing that the administration justified this by stating that it is for inspection and service fees, and that the deducted amount is returned to whoever repays the loan before two years, and that these amounts are not included in the department's budget? And is his work considered assisting in usury?
Source: FtawySummarized from the full answer at Ftawy · imported Sep 2, 2026
The 3% mentioned in the question is usury disguised as administrative expenses, because it is a percentage that varies with the amount of the loan and is waived upon early repayment. If it were truly administrative expenses, it would be a fixed amount that does not change and is not waived. Therefore, it is not permissible for you to continue in this work unless you avoid assisting in these forbidden contracts.
Summarized from the full answer at Ftawy · imported
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- 70874
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