Is it permissible to deal with these Islamic banks?

The questioner : What is the ruling on Islamic banks currently, O Shaykh? Do we deal with them or not?

The Shaykh : No. If you can avoid dealing with banks, do so, except in cases where the permissibility is clearly apparent, or where there is a dire necessity. However, expanding your dealings is not allowed.

The questioner : For example, depositing money.

The Shaykh : You should deposit your money in a trust box. Instead of taking interest, you pay a fee. There are boxes in banks for trusts where you deposit your money and pay them the amount they request, monthly or annually, on the condition that they do not extend their tainted hands to this money and defile it. As for giving them, for example, ten thousand dinars and having them work with it through usury, whether lawful or forbidden, and so on, while you preserve your wealth through this forbidden method, Allah says: .
Abu Layla : In the same issue, O Shaykh.

The Shaykh: Yes.
Abu Layla : There are people who have balances in the Islamic bank. When they learned that having a balance in the bank is not permissible, they said, "We will rent a box." The bank refused, saying, "This box is only for gold and jewelry, not for cash."

The Shaykh : What should we do for them?
Al-Halabi : In the same issue, O Shaykh.

The Shaykh: Go ahead.
Al-Halabi : Some of our merchant brothers, who are committed to the religion, sell at one price for cash and installment. But sometimes, economic crises or similar situations hit them, so they keep the same price. However, if someone comes to entice them with cash, they give him a discount. Their original intention is pure and good; they have always done this. But in some periods, the market fluctuates, and so on. One person says to them, "This money is available," and they say, "I will discount this and that for you if the money is available."

The Shaykh : Yes, if there is no trickery or deception, there is nothing wrong with it. Because profit is not limited in the Shari'ah. It is permissible for this device to be sold to one person for one hundred, to another for one hundred and ninety-five, to a third for one hundred and ninety, and so on. But I am afraid of this issue. First, I am afraid that the commitment of these people you describe as committed is like that of the Kuwaiti—no offense to those present—meaning he raises the price and then says, "My price is one." So when a person pays him in cash, he lowers it to the natural price that is in his mind.
Al-Halabi : If it is in the first form, O Shaykh?

The Shaykh : Allow me to answer you. If there is truly no trickery or deception, and he sells at the cash price the same as the installment price, let us assume, for example, that this person, before knowing the Shari'ah ruling, used to sell at two different prices. He had established a system, and I think this is a system of merchants who want to determine their margins, where he would profit ten percent. That was the case before: he would profit ten percent on cash, and twelve percent on installment, lowering the price by twelve percent. When the man learned that selling at two prices is not permissible, he made the profit twelve percent. This is what we referred to earlier. If it is like this, then both are the same. No, he used to sell on cash with a profit of ten percent and on installment with a profit of twelve percent. So when he repented to Allah sincerely, he started profiting ten percent whether he sold on cash or on installment. This is first permissible, and he is rewarded for it.
And I say to these merchants, if they were believers in Allah the Mighty and Majestic and grateful for His blessings upon them, good deeds would be recorded for them like a saw, which we say cuts both on the way up and on the way down. Why? Because the Messenger of Allah (peace and blessings be upon him) said, and the meaning of the hadith is: Lending two dirhams is equal to charity. So if one person lends someone two hundred dinars, it is as if he gave charity from his own wealth of one hundred dinars. How much would these merchants profit, day and night, if they sold sincerely at the cash price? Millions of good deeds would be recorded for them, whereas the poor among us cannot do this. Then comes the image the brother asked about. If this seller used to profit ten percent on cash and twelve percent on installment, and then he returned to selling on the basis of a ten percent profit on both installment and cash, and a person came and offered to buy from him in cash, but he felt that he would not profit ten percent from him, but rather five percent, there is no objection to that, because the assumption of a ten percent profit is his own, not from the Lord of the Worlds. More than that, we know that some merchants are sometimes forced to sell at cost price, is that right or not?

The questioner : Yes, correct.

The Shaykh : If this is permissible, how can that not be permissible? The important thing in all these topics is that there be no trickery or deception.
Wafi: O Shaykh, is it permissible to have a difference in price for a bulk order versus individual items?

The Shaykh: Yes.
Abu Layla : Allow me, O Shaykh. I am known for selling at one price. But sometimes some merchants come to me and say, "I want a quantity of galabiyas from you." So I tell them the fixed price; I do not sell at two prices. But sometimes I choose to say, "I can give you twelve galabiyas for the price of thirteen."

The Shaykh : How thirteen?
Abu Layla : I mean, for example, I sell you twelve galabiyas and give you one extra. This is from me. I take from you the price of twelve at the selling price of all of them.

The Shaykh : This is also a cycle of deception. But this is ready, what is in it? Now, the price of the galabiya is thirteen. How much is its price?
Abu Layla : One hundred and thirty dinars.

The Shaykh : The galabiya?
Abu Layla : No, the thirteen.

The Shaykh : The extra thirteen, meaning you sell twelve and gave him one, which is number thirteen. How much is the price of this one galabiya?
Abu Layla : Ten dinars.

The Shaykh : Okay, ten dinars. How much is the total price of the twelve?
Abu Layla : One hundred and twenty.

The Shaykh : One hundred and twenty. What is the difference between selling it for one hundred and ten, or selling it for one hundred and twenty and giving him a galabiya on top of that?

Another questioner : There is a difference, O Shaykh, for him.

The Shaykh : I do not think there is a difference for him. I want to ask the person involved.

The questioner : Okay, a little, no problem.

The Shaykh : ... Is there a difference for you?

The questioner : Yes, O Shaykh, there is a difference for me.

The Shaykh : And what is it?
Abu Layla : If the man insists on a discount and says, "No, I do not want anything but twelve," I refuse to sell to him.

The Shaykh : Do not impose a hypothetical situation. Do not impose a hypothetical situation. What is the difference between doing this or doing that?

The questioner : I feel like I find a difference in it.

The Shaykh : Tell me what the difference is?
Al-Halabi : O Shaykh, if he discounts a dinar on every galabiya, meaning to cover the value of the extra galabiya, it is not that you are not benefiting with him, but his profit on the galabiya is less.

The Shaykh : May Allah forgive you, all roads lead to the mill.
Al-Halabi : No, the galabiya is less for him, O Professor. I mean, the galabiya might be at a cost of seven, so when he discounts ten, he saves three dinars.

The Shaykh : But he will sell it, either this one or someone else will buy it.
Al-Halabi : It is possible that he loses the whole sale for the sake of the galabiya.

The Shaykh : Who loses?
Al-Halabi : Himself, because that one wants to discount something. So he does not want to discount a dinar on every galabiya for him; he wants to add a galabiya to the sale, so he does not pay for the galabiya at the same price.

The Shaykh : No problem, the galabiya will remain with him, and its price is ten dinars, he will not get it?
Al-Halabi : He will get it from someone other than this buyer, and his sale might be lost.

The Shaykh : I know, I know, from someone other than the buyer. I am talking about someone other than this buyer.
Al-Halabi : He wants to sell it, of course.

The Shaykh : He wants to sell it. So if the matter returns, all roads lead to the mill.
Al-Halabi : True, but O Professor, it is possible that the man does not buy because he wants a discount.

The Shaykh : Who is the man?
Al-Halabi : The one who is the buyer whom he wants to sell to.

The Shaykh : The one who wants to buy twelve?
Al-Halabi : Yes; because he wants a discount, so he does not want a dinar discount on every galabiya; he wants this galabiya added to them.

The Shaykh : Now you say it is possible he does not buy. In which of the two forms is the permissibility more positive: if he discounted a dinar from every galabiya, or if he gave him a galabiya?
Al-Halabi : For this one.

The Shaykh : Yes, for this one, not the other.
Al-Halabi : It is better for him to give him an extra galabiya.

The Shaykh : No, no. Which of the two sales encourages the buyer to buy more?
Al-Halabi : The discount.

The Shaykh : The discount, this is it.
Al-Halabi : It is that the discount does not cover it; it is for this reason that he gives the jilbab; because the jilbab costs him less than the discount he wants to give.

The Shaykh : My brother, when you say it does not cover it, do you mean he loses money?
Al-Halabi : No, he does not lose money; it means a comparison between the profits.

The Shaykh : Yes, our entire inquiry was whether it is permissible for a person to waive the profit he has set, whether through installments or debt. Our answer was: Yes, it is permissible. He brought up the example that he gives a jilbab instead of what? A discount of one dinar for every jilbab. We said this is permissible without doubt. But also the reverse, which is what you are saying, that it does not cover it, is also permissible.
Al-Halabi : There is no doubt.

The Shaykh : So what is the problem now?
Al-Halabi : There is no problem, our Shaykh. It means that in the case of the jilbab, when he gives the jilbab, he is saving money. Let us not say that it does not cover it; he is saving three dinars in his own situation, because the jilbab might cost him only seven, unlike if he were to discount one dinar for every jilbab.

The Shaykh : This is correct, my brother, but as for him, I say that this jilbab, if he does not take its price from this man, he will take it from others. But this thing that you are observing regarding him, do you think that the one who bought twelve from him does not observe your observation? I do not know it.
Al-Halabi : It is necessary.

The Shaykh : He knows it, of course. So if he gives him a jilbab or discounts one dinar for every jilbab, this is permissible and this is permissible, as long as he has set the price in the Shari'ah manner that we mentioned, not in a manner of going back and forth.
Al-Halabi : May Allah reward you with good.
Wafiq: There is a difference, our Shaykh, that Brother Ali did not notice.

The Shaykh : Also?
Wafiq: Yes.

The Shaykh : What Allah willed.
Wafiq: Brother Abu Ahmad, when he sells to any woman or any man or any brother of his brothers, he tells me, "My price is fixed and never goes down. The jilbab is eleven dinars, eleven dinars. If you take more, the price is one." So when he gives this brother ten dinars, his statement that the price is fixed becomes incorrect. But when he gives him an extra jilbab, it means the price is uniform. So where is the guidance in that, may Allah reward you?

The Shaykh : No, allow me, but this is outside our topic. This is outside our topic. This difference is not within the issue of riba and the absence of riba. This is within the issue of truthfulness and the absence of truthfulness, and this is what you are circling around. Leave us now with these matters. It is not a problem if one says, "My price is fixed or limited," and then he waives it. This does not contradict that his price is fixed. Because it is permissible for him to sell it at its capital cost, as we said earlier. Does this contradict his previous statement? It does not contradict it.
Wafiq: No, the point is that perhaps he added this jilbab for this reason.

The Shaykh : What reason?
Wafiq: So that his statement does not contain anything incorrect.
The Shaykh: No, this is not his intention.