What is the ruling on entering into investment certificates (A), (B), and (C)?
Investment certificates issued by usurious banks, of their three types (A, B, and C), are Islamically forbidden. Certificates of categories (A) and (B) are usurious loans with guaranteed interest, and are not legitimate (profit-sharing). As for category (C) certificates, despite the absence of a fixed interest rate, they involve their holder in a conditional periodic draw, which makes them loans that yield a benefit, and they are a form of (gambling). Jurists have unanimously agreed on the prohibition of specifying profit in mudarabah as a fixed amount or a percentage of the capital because it contradicts the principle of sharing in profit and loss. The alternative to forbidden bonds is (Islamic certificates) based on mudarabah for a specific project, whereby their holders receive a percentage of the actual realized profits.
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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