What is the ruling on the annual return provided by cooperative societies to shareholders if they call it interest on the contributed capital?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
The summary of the answer: These companies sell consumer goods and distribute a portion of their profits to shareholders. These funds are permissible, and the name does not affect their ruling as long as the shareholding is legitimate. The default ruling for transactions is permissibility. One should avoid using the term "interest" (fāʾidah) because it has become a technical term for usurious capital gains.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/31823
Where this answer came from
- Source platform
- Ftawy
- Original fatwa ID
- 31823
- Added here
- . This is when the answer was added to El Fatwa, not the fatwa's date.
- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
- Read the full ruling
- Read the full answer on Ftawy