Deposits in banks and borrowing from them
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Q3: Is depositing money in a bank with or without interest forbidden, and is borrowing from a bank with interest for the need of consumption or trade forbidden?
A3: Depositing money in banks and the like, on demand or for a term, with interest in exchange for the money deposited is forbidden. Depositing it without interest in banks that deal in riba (usury or interest) with the funds they hold is forbidden; because of the assistance this provides them in dealing in riba and enables them to expand in that, except if one is in dire necessity to deposit it for fear of it being lost or stolen, and finds no means to preserve it other than depositing it in interest-based banks, in which case there may be a dispensation for him to deposit it there on account of the dire necessity. As for lending to the bank or borrowing from it, if it is with interest-based riba, it is forbidden, whether that is for the need of consumption, or for development and investment through trade, industry, agriculture, or other means of production; due to the generality of the evidence for the prohibition of riba. However, if lending to the bank is without riba, it is permissible.
A3: Depositing money in banks and the like, on demand or for a term, with interest in exchange for the money deposited is forbidden. Depositing it without interest in banks that deal in riba (usury or interest) with the funds they hold is forbidden; because of the assistance this provides them in dealing in riba and enables them to expand in that, except if one is in dire necessity to deposit it for fear of it being lost or stolen, and finds no means to preserve it other than depositing it in interest-based banks, in which case there may be a dispensation for him to deposit it there on account of the dire necessity. As for lending to the bank or borrowing from it, if it is with interest-based riba, it is forbidden, whether that is for the need of consumption, or for development and investment through trade, industry, agriculture, or other means of production; due to the generality of the evidence for the prohibition of riba. However, if lending to the bank is without riba, it is permissible.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.