Investment in Bank Funds
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The first question of Fatwa No. ( 20565 )
Q1: There are investment funds in banks, and these funds are subject to profit and loss. The profit rates are not fixed, nor are they stipulated by me or by the bank; rather, they are commercial funds. If they profit, so much the better, and if they lose, likewise. Is it permissible for me to invest in them? Instead of the bank benefiting from them and from our money deposited with them?
A1: Invest your wealth in a Sharia-compliant investment outside of banks; because banks generally do not escape from dealing in riba (usury or interest), and they are not truthful in their claims that they invest in a Sharia-compliant manner; because the criterion is the majority of their conditions, so they are not to be trusted. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Q1: There are investment funds in banks, and these funds are subject to profit and loss. The profit rates are not fixed, nor are they stipulated by me or by the bank; rather, they are commercial funds. If they profit, so much the better, and if they lose, likewise. Is it permissible for me to invest in them? Instead of the bank benefiting from them and from our money deposited with them?
A1: Invest your wealth in a Sharia-compliant investment outside of banks; because banks generally do not escape from dealing in riba (usury or interest), and they are not truthful in their claims that they invest in a Sharia-compliant manner; because the criterion is the majority of their conditions, so they are not to be trusted. And success is from Allah, and may Allah send prayers and blessings upon our Prophet Muhammad, his family, and his Companions.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.