Depositing the association's funds in the bank on the condition that the bank donates to the association
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Fatwa number ( 17317 )
Q: A charitable association operating in the Kingdom of Saudi Arabia receives donations from benefactors, whether individuals, companies, or banks, and deposits its funds in one of the local banks, such that the donations are deposited in this bank, which invests them for its own benefit if the association does not request otherwise, without the association receiving any return. The association's management requested
the bank to donate a fixed amount of three million riyals annually in exchange for the presence of the funds with it, which amount to 60,000,000 Saudi riyals. The bank agreed and committed to paying the same amount annually, even if the donations decrease or increase. The question is: Are these three million riyals that the bank donates considered riba (usury or interest)? Knowing that the bank owner may stop the donation if all the money is withdrawn from the bank. Please inform us, may Allah reward you with good.
A : Depositing the association's funds with the bank or any other entity, on the condition of a donation from the bank where the funds are deposited, is considered riba (usury or interest); because it is in the ruling of a loan in which an increase was stipulated; because the reason for the donation is the presence of the funds with it, and because the bank will stop the donation if the deposited funds are withdrawn from the association.
Q: A charitable association operating in the Kingdom of Saudi Arabia receives donations from benefactors, whether individuals, companies, or banks, and deposits its funds in one of the local banks, such that the donations are deposited in this bank, which invests them for its own benefit if the association does not request otherwise, without the association receiving any return. The association's management requested
the bank to donate a fixed amount of three million riyals annually in exchange for the presence of the funds with it, which amount to 60,000,000 Saudi riyals. The bank agreed and committed to paying the same amount annually, even if the donations decrease or increase. The question is: Are these three million riyals that the bank donates considered riba (usury or interest)? Knowing that the bank owner may stop the donation if all the money is withdrawn from the bank. Please inform us, may Allah reward you with good.
A : Depositing the association's funds with the bank or any other entity, on the condition of a donation from the bank where the funds are deposited, is considered riba (usury or interest); because it is in the ruling of a loan in which an increase was stipulated; because the reason for the donation is the presence of the funds with it, and because the bank will stop the donation if the deposited funds are withdrawn from the association.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.