What is the ruling on associations in which some people collect money that they give to one of them every month?
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Question:
What is the ruling on the associations we form, where we collect money every month and it is a person's turn to receive help from the others, as a means of cooperation and to avoid borrowing from banks?
Answer:
This resembles banks, because it is a loan that yields a benefit. You did not lend to your colleagues except on the condition that they lend to you. It was stated in the hadith:Bulugh al-Maram 7:99 The benefit here is that you lent to them in order for them to lend to you, so it is a conditional loan. This loan is not permissible. Yes.
What is the ruling on the associations we form, where we collect money every month and it is a person's turn to receive help from the others, as a means of cooperation and to avoid borrowing from banks?
Answer:
This resembles banks, because it is a loan that yields a benefit. You did not lend to your colleagues except on the condition that they lend to you. It was stated in the hadith:
Every loan, which leads to a benefit, is usury.
كُلُّ قَرْضٍ جَرَّ مَنْفَعَةً فَهُوَ رِبًا
Source
قناة «العلامة الدكتور صالح الفوزان»، ما حكم الجمعيات التي يجمع فيها بعض الأشخاص أموالاً يعطونها كل شهر لشخص منهم؟ #فتاوى الفوزان — youtube.com
The Arabic text is a machine transcription of the audio recording.