Category: Riba, Loans and Working in Banks

The ruling on investing Wealth in Banks with Interest

Question :

What is the ruling on investing wealth in banks, while knowing that these banks give interest for placing money in them?

Answer:

From what is well-known with the people of knowledge of the Islamic law is that investing wealth in banks with Riba based profit is Islamically forbidden, and it is among the major sins. It is declaring war against Allâh and His Messenger, as Allâh said :
"Those who devour Riba will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaytan (Satan) leading him to insanity. That is because they say: 'Selling is only like Riba, whereas Allah has permitted selling and forbidden Riba. So, whosoever receives an admonition from his Lord and stops eating Riba, he shall not be punished for the past; his case is for Allah (to judge); but whosoever returns (to Riba), such are the dwellers of the Fire - they will abide therein forever. Allah will destroy Riba and will give increase for Sadaqat (deeds of charity, alms, etc.). And Allah does not like the disbelieving sinners."

And He said:
"O you who believe! Fear Allah and give up what remains (due to you) from Riba (from now on), if you are (really) believers. And if you do it, then take a notice of war from Allah and His Messenger. But if you repent, you shall have your capital sums. Deal not unjustly (by asking for more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums)."

And it has been authenticated from the Messenger of Allâh that he cursed the person who devours Riba, the person who gives it, the person who writes it and its witnesses, and he said :
"They are the same (in sin)."

This was recorded by Muslim in his Sahih.

Al-Bukhari recorded in his Sahih from Abu Juhayfah that the Prophet cursed whoever devours Riba and whoever gives it, and he cursed the maker of pictures. In the Two Sahihs, it is recorded from Abu Hurairah that the Prophet said:
"Avoid the seven destructive sins."

We (the Companions) said: "And what are they, O Messenger

of Allâh?" He said:
"Associating partners with Allah, magic, killing the soul that Allah has made sacred, except with a right to do so, devouring Riba, devouring the wealth of the orphan, turning in flight on the day of battle, and wrongfully accusing the chaste believing women who do not think of committing lewd acts."

The Verses and Hadiths with this meaning - which is the forbiddance of Riba and the warning against it - are numerous. Thus, it is obligatory upon all of the Muslims to leave it, beware of it and advise others to leave it. And it is obligatory upon the authorities among the Muslims to prevent from this (Riba) those who are in charge of the banks in their countries, and to require them to adhere to the pure Islamic law. This is in carrying out the Law of Allâh and avoiding His punishment. Allah said:
"Those who disbelieved from the Children of Israel were cursed upon the tongue of Dawud (David) and 'Isa (Jesus), the son of Maryam (Mary). That was because they committed acts of disobedience (sins) and they used to transgress. They would not prevent each other from the evil that they did, so indeed how evil it is what they were doing."

And He said:
"And the believing men and the believing women are Awliya' (friends, supporters and protectors) of one another. They command the good and forbid the evil."

The Prophet said:
"Verily, when the people see evil and they do not change it, it is likely that Allah will cover them with His torment."

The Verses and the Hadiths concerning the obligation of commanding the good and forbidding the evil are numerous and well-known. So, we ask Allâh for all the Muslims - the rulers, the subjects, the scholars and the common people - success in adhering to His Islamic law and standing firm upon it, and being aware of everything that opposes it. Verily, He is the Best Who is asked.