The Ruling on Taking a Loan from the Bank Using Goods Approved by the Sharia Supervisory Board
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Question:
The questioner says: I want to take out a loan from the Arab Bank. They say they have cars, wood, and shares, and that these are approved by the Sharia Supervisory Board. What is the ruling? And how is this loan valid?
Answer:
My brother, this is not a loan. This is a purchase. This is a sale, a purchase, not a loan. Calling it a loan is a mistake, a great mistake. This is a sale and a purchase, and this is what is called the issue of tawarruq. Tawarruq is when a person in need resorts to buying a commodity from a merchant for a deferred price, then sells it to someone else for a spot price and benefits from its price. When the term is completed, the debtor pays off his debt. According to the majority, this is permissible for pressing need, and it is the issue of tawarruq. It is called tawarruq from al-warq, which is silver, because the one dealing with it is in need of al-warq, meaning silver or currency. It is called tawarruq. The commodity must exist in the possession of the seller at the time of the contract, and the buyer must take full possession of it, remove it from the seller’s place, and sell it to someone else. This is required. Yes.
The presenter:
May Allah reward you.
The questioner says: I want to take out a loan from the Arab Bank. They say they have cars, wood, and shares, and that these are approved by the Sharia Supervisory Board. What is the ruling? And how is this loan valid?
Answer:
My brother, this is not a loan. This is a purchase. This is a sale, a purchase, not a loan. Calling it a loan is a mistake, a great mistake. This is a sale and a purchase, and this is what is called the issue of tawarruq. Tawarruq is when a person in need resorts to buying a commodity from a merchant for a deferred price, then sells it to someone else for a spot price and benefits from its price. When the term is completed, the debtor pays off his debt. According to the majority, this is permissible for pressing need, and it is the issue of tawarruq. It is called tawarruq from al-warq, which is silver, because the one dealing with it is in need of al-warq, meaning silver or currency. It is called tawarruq. The commodity must exist in the possession of the seller at the time of the contract, and the buyer must take full possession of it, remove it from the seller’s place, and sell it to someone else. This is required. Yes.
The presenter:
May Allah reward you.
Source
شرح كتاب التوحيد [ صالح الفوزان ]، تابع باب ما جاء من التغليظ فيمن عبد الله عند قبر رجل صالح، فكيف إذا عبده ؟ - 2 — islamhouse.com (35:02)
The Arabic text is a machine transcription of the audio recording.