Taking interest from the bank and paying it for charity is subjected to different views; the first says it is prohibited to save money in usurious bank. The other says the interest could be taken and paid to charity. 

Giving Bank Interest to Charity

Similar Questions

• Can charities accept the interest money Muslims send them;

• Taking interest from banks and giving it to charity.

The Issue

A Muslim living in a non-Muslim country may receive interest on the money in his bank account. He may prefer to take this interest and use it for good causes, such as paying it to a charity. He might feel that this is preferable to leaving the interest with the bank, which may then use it to support some organization which carries out prohibited activities, like a Christian missionary organization.

Ruling

Scholars have two different views regarding taking the interest from one’s bank account and giving it to charities.

The first view considers that it is not permissible to deposit one’s money in a usurious bank in the first place. If one finds it necessary to do so in order to keep his money safe and he does not receive interest on it, then there is no harm. However, if the account earns interest, then it is not permissible. If he uses the funds that represent the interest, out of ignorance or carelessness, and then repents he should give the money to charity and not add it to his own account. This is the view of Shaikh Abd al-Azeez ibn Baz.[1]

Evidence

Usury is one of the gravest cardinal sins and God has prohibited it in His book, the Qur’an, and through His messenger. He tells us that usury will be blotted out and that anyone who deals in it is at war with God and His messenger. If a person takes usury out of ignorance or carelessness then realizes his fault he must not keep it with the rest of his money, because usury contaminates whatever money one has, and he must spend it on some good and charitable purpose.

The second view considers it permissible to take interest from one’s account and give it to charitable organizations. It is also permissible for charitable organizations to ask people with usurious accounts to pay any interest they receive to them. This is the view of the European Council for Fatwa and Research, the Indian Fiqh Assembly and a number of contemporary scholars.[2] However, they say that money gained from interest payments may not be given to mosques to cover their expenses.

Evidence

The interest that can accrue on large sums of money is considerable. If it is left to the banks in non-Muslim countries, which are run by unbelievers or sinners, they may use it for purposes that are detrimental to Islam or Muslims, or they may use it to support unbelief or wrong creeds. Therefore, it is preferable that Muslims should take such interest and put it to good use.

Muslims living in the West need to open bank accounts and some accounts do earn interest. They are then faced with two alternatives; either they leave the interest accrued in their accounts to the banks, which will mean missing out on important benefits for Muslims, or they spend it on some good and charitable purpose. If the interest is left to the banks they may give it as a donation to some missionary organization or for other forbidden use. Since the prohibition on usury does not apply to the money itself, but rather to the way it is earned or spent, then the prohibition applies to the person who earns or spends it unlawfully. Hence what is forbidden with regard to such usurious earnings is when the person concerned uses it for his own purposes. As for other users, it is not forbidden.

The condition that prohibits giving such interest money to mosques, as mentioned in the decision of the Indian Fiqh Assembly, is based on the fact that mosques are houses of worship. Therefore, to keep them pure such places should never be given any suspect money.

Sources

• The website of the European Council for Fatwa and Research: www.e-cfr.org.

• Decisions by the Indian Islamic Fiqh Academy.

• Fatawa al-Aqaliyyat al-Muslimah by a number of scholars.

• Mustafa al-Zarqa, Fatawa.

• Abd al-Azeez ibn Baz, Majmu' Fatawa Ibn Baz, edited by Muhammad al-Shuway’ir.