MoneyMatters – All About Riba QA 1
Channel: Mansoor Danish
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mundo hamdu Lillah wa salatu salam ala rasulillah. Remember I said I'm Ali Khan wedding Villa heuberger. To everyone in general to Allah today, we have this amazing session for you all,
brother Massoud, for being here with us. We have a lot of questions for brother. For you. I'm going to try to summarize and the questions that are being repeated, just that I'll try to make sure that I put them in one category. And once we are done, if we have time, then we will take the questions that have been received just recently. So the first question, brother is about Islamic banking.
There are a lot of students we have students from Pakistan, India, Qatar,
everyone asking about Islamic banking, how to avoid a Riba.
someone claims that in Islamic banking, there is no Riba. But then there's another view which says that you cannot possibly escape from Riba and there is no concept as Islamic banking. So like, for instance, we have a brother it's a pond from Qatar. He said what is the Riba concept in Islamic banking we have from India brother Mirza, he also asked for even the books, what are the books that one can refer to? To make sure that there are well informed about about Islamic banking, Islamic Finance? We have also brother Arthur from India, and he says
how do we avoid
Riba? If we have an account in a bank? So they're all asking about Islamic banking? So what is your say in that?
All right. I hope I'm audible back. Audible to all of you.
Yes, brother. Okay. Now, firstly, as far as
the Islamic banking is our concern, this is a question which we cannot
deal with, by just simply telling you Poland and Poland bank is Islamic. Poland, Poland bank is not Islamic. So some of the questions where people are trying to inquire about how do we judge whether an Islamic bank is following the Sharia principles to the best of my understanding on the subject? If you have a Sharia advisory board, which oversees the work and does not act as the pain employee of the bank
does not act as a paid employee of the bank, they will be paid money for doing the work. That's why I said they should not act as a paid employee of the bank.
But rather, they prioritize ensuring that the teachings of the Quran and the Sunnah is not
jeopardized in the garb of allowing transactions to flourish with backdoor Riba. What I mean here is, you will find many Islamic banks have a Sharia board. And this Sharia board has a certain scholar who gives approval to lot of transactions, which may sound Islamic, which will give you sounds like murabaha, butia, Raka mudaraba, it sounds Islamic, but when we start breaking down the contract and go into the terms of the contract, we shall find that there are it's nothing but backdoor Riba.
So that is why it's extremely important that you have empowered Sharia advisory board.
The best situation to deal with all of this should be that there should be a unified body like you have
IMF, which is you know, unified body and many of the banks have to comply to the guidelines, you have the bazel norms in so many novels which are being done, where all the banks come together and they have to maintain these capital requirement guidelines. So when you have these independent bodies, which have been nominated, I personally believe that we should have independent bodies
which should be set up and any kind of product should be approved on the basis of the benchmark
Under said by this independent agency, so if you ask me, what is the way out? The way out is that there are many of you people are students here of Islamic Finance, and insha. Allah, if you pursue your studies further, try and raise concern, try and raise this discussions and debates on having independent bodies. And these independent bodies should not be restricted merely to regions, for example, a separate body for foreign countries or separate bodies of the subcontinent a separate bodies for the Middle East, a separate agency for the European countries know,
how does it work for conventional bank, they all come under a common body,
a common independent agency, or an organization. So this is what my suggestion is that we should have an independent agency, which oversees all of these transactions, this is what it should be. Now, what should we do on the basis of what we have right now the Islamic banks which are running? How am I supposed to know whether they are Islamic or not? This has to be analyzed on a case by case basis. So if you are dealing with any Islamic bank, if you are keeping your money up in account with them, you need to check what are the terms and conditions
and you have to get it checked with somebody who's a who's an approved scholar.
There are some prominent scholars like Peter Thiel, money, these are prominent names in the field of Islamic banking and finance, they are respected globally. If these people approve of some of the operations of the bank, you can rely on the Ha ha, I'm talking about the common man, okay? Common men who don't have knowledge of finance, banking, what are they supposed to do, if you have people like most of you have money, etc. These are respectable people, we may differ with them in their opinions, we may differ with some of the HFR. But we must remind ourselves over here, the happiness of the Prophet alayhi salaatu wa Salaam. But if we have, it's definitely different. If a scholar
does an HDR image, so he does an HDR, and he gets it right, he gets two rewards. And if he gets it wrong, he gets the reward for doing the HDR putting exerting himself.
So we must respect
this ha ha the differences which can be there. Unfortunately, we are a little intolerant these days, because of
the knowledge, the easy availability of knowledge. Because we started importing a lot of opinions, we have to understand that in some places, and I know that there are differences in opinion, which can be there. But I personally believe that in some cases, you will have to know your local conditions, your local customs,
the local customs may not be fitting for an Islamic bank right now. So then you have to rely on the words of the local scholars then, if you import a fatwa from, say, Saudi, where they have an Islamic banking setup entirely, within inverted commas, I don't know how Islamic it could be. But if you bring a fatwa from there, and you start applying it in your country, everything will become non permissible, and you can put your money in your bank and then eventually you will be left with no option. And then when your employer comes and says, Where am I supposed to give you your salary? You tell him I want it in cash, he's going to show you the exit door. So you need to know that
differences in opinions are there among the scholars, respect your local scholars try to see their opinion and you as I said, prominent scholars like to use money etc. Reach out to them take their opinions as well. I can do this because I know of a bank in UK, or was it in Canada, one of them. Islamic bank used a fatwa of Mufti Taqi Usmani and most of us money later clarified that he had never given any such fatwa to that bank. This was given to another bank and the conditions was different. This bank has used that fatwa they borrowed the fatwa and they are selling the same product but with some changes. But as a backdrop, they're using the platform. So they're confusing
That's why I said you should have a Sharia advisory board which is active. You can't just simply import a fatwa and start using it as an active shery advisory board. We have people who are well versed with the subject, we have people who are independent, and who are not slaves to the company, Sharia scholars who become slaves to the company and they are always trying to find ways to allow some products to come into the system. That is not permissible. You know, the Jews used to do this. We know the history.
What they used to do they were told not to use fishing on the day of Sabbath. So what would they do? They would try to manipulate the ways to break the law.
We shouldn't do that we should try and stick to the prominent scholars who are there. And personally, I believe if you have a Slavic bank with whom you're dealing, if you need more clarity, share the agreements with me or with any other scholar and try to seek the opinion. If you have a savings account, you're not sure you feel there's something dicey something doubtful. Ask me ask somebody Arshad awesome. And again, is there, you could ask any other scholar who's locally there who is well versed on the subject, by the way, you can ask them and inshallah they will be in a better position to clarify all of this. As far as the books are concerned, there are a lot of books
that you can read some of them, which I can just suggest you a couple of them, or introduction to Islamic economics by Mohammed a companion, Introduction to Islamic finance by Makita. Money, the art of Islamic banking and finance by yahia. Man, and yeah, and then there is one which is Islamic finance for dummies by filial Jamal have been, I will share these names with the organizers and they can post it in the whatsapp group.
I hope I have been able to address the questions which were asked.
Yes, brother. Um, there's another question related to Oh,
yeah. Can you hear me? Yeah, it's better. Okay. So there's another question related to it. It is about the saving accounts. So there are many students who asked about is the interest in saving accounts or selling banks haram? Is Islamic banking, purely halal?
The especially if a person has a savings account is a person saved from a Riba in any way? Is this true? Or not? So
the difference between current and semi accounts that is asked, and how can one have an account in a bank and not indulgent everybody? This is another question.
Okay, firstly, interest in Islamic banking savings account. That sounds like
confusing to me. Why would an Islamic bank give interest in first place? So if you mean interest in a general savings bank account? Is that haram? Yes, it is. aura. It's Riba. If Islamic banks also start doing that, that they tell you come and put your money, oh, by the way, that perhaps I understand where you're coming from, you know, when I landed in one of these Middle East countries, I'm not naming them. I landed in this middle east country. And as I was going down, you know, to the place where I had to stay, I saw the advertisement being put up by some of the Islamic bank. And they said, We are offering a provisional rate of return on a savings account of 4%. provisional,
it's not guaranteed. It's not like a conventional bank, which gives you three and a half percent of 4% guaranteed every quarter per annum, paid quarterly. This is an Islamic bank doesn't give you anything, which is guaranteed, please saying this is provisional. It could be 3.5. It could be 4.5. But by the way, they also mentioned historically, we have always paid for possession. What are they trying to do? trying to fool us? All right. What are they trying to tell you is listen, if you put your money with us, we're paying you 4% they've just changed the name to provisional if they try to do this kind of tricks. You know, this is haraam. You can't quote percentage, what is allowed with
Islamic bank is a kind of savings account, which is following the concept of the mudaraba the modaraba savings account, where the bank acts as the Buddha if you are the rumble mile, the owner of the money, you give the money to the bank, you keep it with the bank, the bank is supposed to be an expert in managing the money, they can use this money to invest it in different projects, business projects, etc. So, if you offer a modaraba savings account, the bank will utilize that money in different business projects from the business projects, they can be returns which can be generated and as the returns are generated, it could be paid back to you could be 5% 7% 8% could be even a
The capital can get eroded. This is allowed. But if in the name of modaraba, Zim Macau, just for the namesake, they start giving you a provisional fixed return of 4%. This is how
I can give you another example of such things which is happening. There is a bank. It's called in Oman. It's called the Al is Islamic bank is
Islami, it came up with the Bushra savings account. You know, we sure are glad tidings Mishra savings account, what was the gap driving open an account with us savings account. And we give you glad tidings, we will give you certain money back into your account. What is that? It's rubber.
It's rubber. They're inviting you to open account with them. And they're telling you, we'll give you a certain percentage. And I'll tell you something I wrote back to Islamic bank. And the reply I got from them was, we have Sharia scholars who have approved this, this is the problem.
This is the problem that we're dealing with.
That there are cases where you have genuine differences in opinion amongst the scholars. And then then you have these cases where you have Sharia scholars, who are just experts in the academic aspect of Sharia. They've academically studied whatever is required to become a Sharia scholar.
But they don't follow it in it in the spirit. You see, when you're a Sharia scholar, and you sign on a piece of paper, you are validating that this is asper the teaching of my rub, and the teaching of my Nabi sallallahu alayhi wa sallam, whoa, what a responsibility that is.
That is called doing it in letter, and spirits. But if you are a person who's just done it for academic purpose, I want to become a Sharia scholar, academic purpose. And in order to do that, once I have reached a certain position, and now work with the bank, the bank tells me Look, sir, this is called Iran now find a way to make it Hello, and people sit down to try and make it a lot. You're not following it in spirit, like I give you an example, just now of a bank, which is allowing rubber. So as far as Islamic banks are concerned, if they're offering you any kind of savings, which is picked any kind of returns, which is fixed, this is not allowed. But if they offer you some
returns in your savings account for the money that they utilize of yours, which means there is risk also involved, the money can benefit, the money can go down also. And if you have opted for that kind of a modaraba savings account, there's no problem with that.
There are other savings account also, which is there with the banks where you clearly tell the mind, whatever money I'm given, giving you it's in safe custody, don't do anything with my money, I've given it to you, I'll take it back.
Here, the bank doesn't give you anything, because that's the terms and condition.
such kind of savings account are allowed. So that's why I again, like I told you for the earlier question, if you have certain banks who are allowing you all of this, send me the details, send me the terms and conditions of the savings account, you know, the savings account form will have these terms and conditions where they will tell you that they're going to be used certain percentage, get a form, get an application form with the terms and condition, send it across to me in sha Allah, I'm going to review it, and I can give you a better answer. Another question, which I think you said is does Islamic bank have purely halaal transaction? Is that right?
Yeah, how can a person have an account in a bank and not be intelligent Riba? How can one save oneself? yet? Have a you know, account in a bank? Any bank? Not Islamic bank? So let's answer that. This way. As far as being an Islamic bank is concerned again, as I told you, first and foremost, we must try and go to a bank which is Islamic bank, alright, wherever you are trying to reach out to an Islamic bank. And then of course, we try to see subsequently whether it is following it in letter and spirit or not. If you are a layman, then in this case, what I suggest to you is see who the Sharia scholars are. All right. And if you can personally try and reach out to some of the Sharia
scholars, if they are renowned scholars, you can reach out to them do that, try to reach out to them and see what are their opinions about certain bank. If they say that yes, full on and full on bank is good, then you can
trust their rich to heart and go ahead and invest. And subsequently if you come across certain things which are wrong, you can always make correction because you've followed the it's the hands of an alum. And when you got a stronger opinion, a stronger view, you changed your view, we need to be flexible in this regard. Coming to general banks, where we don't have an option, no Islamic banks, for example, if you're in India, no Islamic banks, what am I supposed to do? How can I save myself I need to open an account. So first and foremost, you don't open a savings account, you open a current account with such banks. By the way, just for your knowledge, current accounts are not only opened
by sole proprietors. Current accounts are also
To open by individuals and the RBI or the Reserve Bank of India, in titles, individuals to have current account. So you can open a personal current account, some of your banks will tell you, so where are your trade license? You're not a businessman? How can you have a current account? That's lack of knowledge, you know, many people who work in the bank nowadays, I'm sorry to say this, most of the frontline staff, they don't have knowledge. Back in our days when we were growing up, we used to hear our elderly still tell us that you know, so and so's working in a bank. It was like a big thing. You know, Mashallah people are working in a bank, they must be so knowledgeable, so educated.
Today, most of the people who work in a bank, they don't even know the basic knowledge of bank, they could be from any industries, they're just taking in lock stock barrel, just taking into the bank to sell the products. If you read if you're okay selling, that it can take you in anyhow.
Go for a current account, don't go for a savings account. Firstly, secondly,
if you have a savings account with them, if you cannot open a current account for whatever reasons, they don't allow you to open a current account in the situation like this. Whatever money you're getting in as your interest money, every quarter is disposed that interest of as soon as it comes into your account, all right. So on a quarterly basis, as the money is coming in, he is disposed of the money which comes into your account, you cannot seek any benefit from it. You can give it to whomever you want, you can give it to a Muslim, you can give it to anonymous, to anyone whom you want. People say can I use that money to make washrooms for myself? No, you can't. You can't take
any benefit from that interest money, that interest money has to be disposed of you can give it to whomever you want. All right. Many people come up with this argument. Look, interest is haram for me. But I have to keep my money in a bank, and the bank is going to give me interest. Why should I give it to them in a current account that we keep it in a savings account? Anyways, I'm not benefiting from the money, let the money come in. At some point people will benefit. Look, Allah has permitted Zakat and sadaqah. The count is compulsory and the broader definition. So the key of course, would include the cost in the province the definition but in a specific definition, anything
over and above the car is also got its great rewards. So please use your money to do so the car from day, don't worry about the helping the poor with your interest money, that interest money, you are just getting rid of it. It's like a dirty money, or right, which you're getting rid of. Look at it from that perspective. And you must consciously strive to have a current account instead of a savings account. Please give up on the savings account. The difference between current and savings account as one of the questioner asks a current account doesn't give you any interest, you keep your money with them, and you withdraw your money from them. In fact, some of the current companies can
even charge you money for keep using the services in current account, because you're taking help of the services. Whereas in savings account for keeping money with them, they give you interest. That's the difference. The basic difference between the two.
Always go for current account, don't go for savings account. Alright? Even though I know savings account, the interest will come I can help the poor, you don't have to worry about helping the poor with interest, help the poor with your Southern harmony with your charity money, so that you own reward.
I hope that answers the question. Is there anything that you have missed out? Oh, yeah.
So yeah, by extension of that, there are two questions. One is what about those who are working in banks, like for instance, a sister esmart, from Somalia mentioned that children were being assigned banks feel their salaries thought halaal, as the banks are involved in Aruba. So what do you do about that? Then we have Marian from Pakistan, asking is any kind of job in a bank allowed at all? This is one after this after another one related to what you just mentioned. Okay. All right. Now, as far as working in a bank is concerned, first and foremost working in an Islamic bank?
And is the salary Hello because the children? Exactly. Hello. First and foremost, we need to understand that the entire concept of Islamic bank that we have today is how old? It's about 50 years old. 60 years old. All right.
Some data on having a session. All right, I know. I'll join us later. All right. That's my son informing me It's time for dinner. Well, we'll continue with our session inshallah. I'll have a late dinner. Okay. Moving on with the answer which I was trying to tell you here. If your family is come to know about an Islamic bank, which is not 100% working according to the Sharia guideline, let me tell you, most of the Islamic banks are not 100% Sharia compliant. They are not 100% to the Sharia guidelines. And there's a
reason for it understand that this whole concept of Islamic banking is only 5060 years old. And it evolved as
a fallout or rather not a fallout, but because of the need and the desire amongst the Muslims to have a separate system for themselves. So we had the first Islamic bank come up in Egypt, and then the
whole concept started spreading, we need to understand that because of all of this, there is still a lot of study which is being done.
The conventional bank was born out of the money lending system, which was on the basis of rubber.
So the whole foundation of the conventional bank goes back to Riba,
the money lending system, it was streamlined, the entire money lending system was streamlined. And it was given the shape of a bank.
Now, what the Islamic banks are trying to do is they're trying to use the existing structure and make changes wherever possible. It's not easy. It's difficult. Unless you change the foundation, you cannot get a proper standalone Sharia compliant structure. So it's possible that most of the Islamic banks may not be 100% Sharia compliant. However, if your children are working in those banks, and if they can utilize the presence in that bank, by continuously giving feedback, if they've come to know something is not Sharia compliant, and they can use their power to reach out to the Sharia advisors and give the feedback and keep giving the feedback and their opinion and their views. They are doing
better for the bank, you know, if the if the banks are genuine, if the Sharia advisors are genuine people, they will welcome your feedback. Alright, so my suggestion, my recommendation is if you're working in an Islamic bank,
there has to be reasons for me to understand what you mean by they are not Sharia compliant, if you mean to say that everything, which they do is duplicity all in the name of Sharia compliant, then of course, the income over there is haram, you have to leave the job immediately. Because what they're trying to do is deceive people, but someone who's genuinely trying to reach out but are facing the challenges because interest is everywhere around you. And you're trying to create a niche for yourself. In systems like this, you should be contributors, see how you can contribute to help the system become rebuff free. That's as far as Islamic banks are concerned. As far as just general
banks are concerned conventional bank isn't working in a conventional bank is hard. It's not permitted. It's not permissible. You must leave the job, any kind of job, even a job of a security guard is not allowed. Even if I'm not selling a loan, even if I have nothing to do with an interest, even if the bank has a Sharia compliant mutual fund. Can I sell a Sharia compliant mutual fund for Bobby's bank? No, I cannot. If it's a very Bobby's bank, conventional bank, you cannot work over there. Don't take any money from them. The money the salary that you earn from there is on you. What if your question that was not asked, but you know, a related question can be that what if I'm
working with them? You know, my spouse is working in a bank. And he doesn't listen to me. He says this is a loan. What am I supposed to do? Is this money haram? For me also, the money is haram upon him, you should make it clear to him. It's not haram on you. The sin is not yours the sin is is if he doesn't listen, if he insists on working, the sin will be his it's not haram on you or your children. Okay, but of course, this was not a question which was asked, but you know, generally, people are worried about all of this. So I answered that. Yes.
Yes. Actually, that was one of the questions I received, also a sister asking that he couldn't convince her husband. Okay, so now there's, um, there's a bunch of questions about credit cards, some are general and some are specific. And but I mentioned that specific question, and you can then add a little bit general information about that. So the question is about the reward points. The question from us.
The question is, could you explain whether the reward points on different cards considered about or not? And should we stay away from using reward points? These come with almost every card in us and it becomes hard to stay away from them? This is a specific question, but generally there are many questions asking about credit cards and Is it wrong to purchase a credit card even though payment is done before time etc.
Okay, so now we go back to the basic question first, whether it is permissible to have a credit card because once it's permissible to have a credit card, then we can move to the second part, which is the reward points.
There's a difference in opinion over here amongst colleagues, you have
the oral esta gilbane.
They are of the opinion
that if you take a credit card
and you pay it within the 40 day period, or the 50 day period, which is the period for which they don't charge you any interest, and you pay it off within the 50 day period, 40 day period, no problem, you can take a credit card. In fact, they say two conditions, the first condition is that you shouldn't be having the money in your bank account, you take a credit card, and then you have a bank account where you have your money. So if you are using a credit card, you can only use it to the tune of the money which is there in your bank account, so that on the due date, you know, you have money to pay it off.
The second condition they say is let's suppose you don't have money in your bank account too many people are salaried individual, so they get the money on a certain date. So if you know that you will be in a position to pay within the due date, even though you don't have enough money now, even then it becomes permissible. So we find that the darville if the joban scholars, they give permissibility for using a credit cards.
Now, if I go to the fatwas of the Saudi scholars, they say thank God is not allowed. Why? Because there is a term which says there is a clause which says that if I don't pay my credit card views on time, then I will have to pay an interest. So I am actually signing a clause for interest.
Again, if you go to Islam QA, there is a opinion, which I had come to Islam to is the fatwa side of exile el manantial, where a person from us asked that most of the services over here has to be dealt with via credit card. You know, you go to the gas station, they only accept credit card, what am I supposed to do? If I follow the fatwa of the Saudi scholars, I'll never be able to go to the gas station, and I'll never be able to refill my car. So the scholars say, well, in a situation like this, if you have to take it up, then you're allowed to do it as an exception. So you can see, there are differences in opinion. Personally, I feel if you are in a country where you have an Islamic
credit card system, where there is no such cause or clause or interest and penalty. There is nothing wrong in taking those Islamic credit cards and using them. However, if you are in a country, for example, you're in India, and you don't have any Islamic records, and Nowadays most of the transactions are taking place online.
every transaction in fact, India is moving towards digitalization, very strongly big time. Most of the countries globally are moving towards digital digitization. And after the lockdown which we've had the Coronavirus thing many people prefer to buy online. And when you're buying online, people know that there is always the risk that if you share your bank account details, your debit card details, people hackers may get access to your details, and they can enter your bank accounts.
So giving your bank account details is more risky. But if you have a credit card with a specified small limit, even if he gets that card, he can only probably swipe it to the limit of the credit score.
So in such cases, it seems you the credit card would be less risky for me to use online than a debit card. Because I know with credit card my risk is limited to the credit limit. With debit card, he can enter my entire bank account
if it has the details. So with all of this happening around us, I personally feel the settler of the DAO esto here seems to be acceptable in a situation like where we are in, say, India, or maybe you're in the European countries where there is no one is no Islamic credit card, then it's all right. Other scholars are of the view that well take a credit card, but we load the credit card before using it. Alright, so that there is foolproof chances there is foolproof that you will never pay interest. Well, I think that's again a difference of opinion. Personally, I feel that you can use or you can use a credit card. Now coming to the issue of credit card reward points. Here again,
the scholars say
again, there's a difference in opinion or right over here.
If you go with the Saudi scholars credit card is not allowed if credit card is not allowed. So the reward points is a waste if you want to go with that password, so all your reward points are gone.
You can't use them.
What they say is if you have a prepaid credit card, well, which is no more a credit card anymore, it's a prepaid card, it's not a credit card anymore. If you have a prepaid card where you know the money and then use it, and you get reward points, then you're allowed to use it because you had put in the money, and then you use your own money, you didn't take any loan from it. But when you take credit from them, and use it, in return of which they give you some materialistic benefits, then they say this becomes horrible. So the only condition on which they allow is a, if it's pre loaded
with your money, you use your money, and you get something for using your own money, no problem.
But if you take it as a loan and use it, and then they are giving you something additional, they say that this is not allowed.
So on the issue of reward points, again, you will find confusions between the scholars. Alright. So we, I personally feel that you have an option here, I've given you both the first was the first was of the most prominent school of thought that we have in the subcontinent, which is the Hanafi school of thought. And I've also given you the opinion of the humbly school of thought, which is the more predominant opinion in the Middle East. Now, it's over to you, whichever opinion you feel is the strongest. You can use that.
Yeah, sure. Thank you go ahead.
Okay, so now we have a bunch of questions. In fact, let me first
there are some students who are wondering, okay, if I have earned money by working in a bank, or if I have in one way or the other, somehow earn money, which involves Riba?
Can I use this money to pay a tax or to,
from the interest money,
interest money, can I can I do I just have to like, give it away in what is how to dispose it off? That's the question that has been asked again, again, okay, how to dispose of the interest money, and can it be used for paying off taxes?
First and foremost, as I mentioned to you, that the interest money which you're disposing of, the intention should be very clear that I'm not seeking any subpar reward or benefit from this, I'm not expecting that on the Day of Judgment, Allah subhanho wa Taala is going to reward me because I was distributing my interest money amongst the poor.
The whole idea of getting an interest money itself is to be issued, it's to be avoided completely. So you don't get into a system where you're getting rebar in the first place. You don't put your money in a fixed deposit with the bank, don't go to a bank and keep your money in a fixed deposit. Don't go to a bank and keep your money in a savings account, which is getting you the interest in the first place. Rather, keep moving them gradually to a current account setup. That should be your focus, gradually keep moving your money into a current account. Now, if I have already put it into a savings account, or I had a fixed deposit, because I was not aware, and I have some interest money,
can I use it to pay off my taxes? The answer is no. You cannot.
Why? Because taxes are something which are legitimate payments made to the government.
Because by paying to the government, you have a convenient with the government that as a citizen, or as a person who's resident in that country, I shall be fulfilling the laws and the guidelines. And for that, if I'm they are allowing me to work there and stay there they asking me to pay the tax, whether the tax money is being utilized in the right manner, whether it is Sharia acceptable etc, is a different question altogether. You go if you if you find that it is not
Sharia compliant, then you go to another country, you do your migration, but if you're staying in a country where they have a taxation system, you have to 100% abide by that. And before I answer the interest versus tax setup, I want to make it absolutely clear here. There is absolutely no concept of cheating the country and the government by hiding your income so that you don't pay taxes.
You can't hide your income. You have to 100% disclose your income to the government, because you have Muslims fulfill their trust. as Muslims, we can't lie. We can engage in deceit. Whether the government uses the money in the right projects or not. That's for the government and those who are
quality's over there. They are answerable to Allah on the Day of Judgment. But as a Muslim, I have to fulfill my trust. If I'm staying in a country, I have to follow the norms and guidelines disclosed 100%, I cannot manipulate, I cannot deceive, I cannot cheat.
So let's be very clear with the basic as far as taxes are concerned. So can I now use my interest money to pay taxes? No, I cannot. Because what I'm doing is tax is a liability upon me, I need to clear it an interest and using to pay off means I'm taking benefit from the interest money. I mentioned to you a while back, when you are disposing your interest money, you can't make a washroom with that. Why? Because you're getting benefits. If I make a nice washroom for myself, you know, I can spend another 15, half an hour, 45 minutes over there now. So I want to make it you know, more spacious, I'm trying to see benefit from that investment. This is a lot more benefit can be taken
from interest when your tax is a liability on your income, you have to pay. If you don't if you feel the taxes too high, put in extra effort, work harder, try to earn more money, so that you can make up for it. There are certain tax saving schemes which are there. If you find any Sharia compliant option. gophers have such Sharia compliant option. If there are none, you have to pay your taxes. You can't use your interest money to offset it.
Another question, I think, which was where else can we spend our interest money, you can give it to anyone who needs it, you can give it to a hospital, you can give it to any charitable organization, anyone you dispose of the money, you can't keep the money with yourself. When people lend the money lie in a bank account, don't do that. Take out the interest money and give it to whoever needs it. Get rid of that money. However, personally, you should make a strong resolve not to enter into any interest bearing contract any further. So whatever you're paying off this time shouldn't be the last time you're paying off. In the future. You shouldn't be getting any further interest. You have a
fixed deposit, Greg the fixed deposit, move their money into a current account, look to invest the money in different projects, business projects. That's where you can earn a lot of money. I hope that answers the question.
Does that not? Okay, so we have a few questions from US, UK and some European countries. Were they asking regarding mortgage?
Is it haram? And if it is, is it harder in every case? And there's one particular question how can I structure Hello mortgage in a non Muslim country? So I can purchase a real estate with investors for the purpose of developing it? And I will
I would only need a short term Sharia compliant loan. So there are one question concerning this. How would you answer this?
What was the last question?
Okay. This is a question from us. How can I structure a HELOC mortgage in a non Islamic country?
The last question yes part of this one so I can purchase real estate investors for the purpose of developing it. I would only need a short term Sharia compliant loan.
Short term Sharia compliant. Okay. All right. And the first question was, what about Alma? What about mortgages in a western country? Yeah. Is there any way that if we cannot avoid it? Yeah.
Okay. Well, first and foremost, we need to understand that a lot is overstock is the provider? Do we have any doubt about it? Ask yourself, you don't need to answer me. Close your eyes and ask yourself, do you have any doubt that Allah is always up?
That he is the provider any any doubt for a moment Also, if you have then you need to work work on improving your EMR.
Now, I would understand that all of you who are attending the session here have absolutely not a single doubt that Allah is a Rosa he provides and provides in every way, not only in the matter of risk, but in every aspect when you say allies amazake don't restrict his
attribute only to money, but we include every aspect of provision in our life. And one of those aspects is shelter. shelter is also kind of provision that we seek from Allah subhana wa Tada. Do we say that a lot of handled the other has sent us on the face of the earth, given a given us a body of guidelines, laws.
But left us absolutely clueless in a country where I'm forced to engage in that which is equivalent to waging a war against a lineman
and I can't avoid it.
I tell you how you can avoid markets. You can avoid more
Get by making a strong resolve from day one, that I will never take a mortgage in the first place. I will opt to stay as a tenant, I'll pay rent, I'll stay there as a tenant. Many people say, so if I pay tenant as a rent for the next 2530 years, I still remain a tenant, I don't become an owner, had I taken a property in 10 years, I would have become an owner of the property. So Isn't that better? Our objective in this dunya is not to amass wealth and properties and materialistic benefits. Our objective in this dunya is we started off with this complete open obedience to Allah subhanho wa Taala.
complete obedience. So an aspect of complete obedience is if you don't find halaal mode gauge, which is meeting Sharia guidelines, you stick to whatever is the alternative halaal alternative, the halaal alternative to mortgages, don't take a mortgage, stay as a tenant.
That is allowed.
Or you can restructure products, which is the second question. I'm going to come to that later. But I'm still addressing the first question. Yeah. So if you are staying in the country, you have every possible way to avoid it. Otherwise, if you are attending this session, explained to me why why do you say it can't be avoided.
Second thing which I want to say with regards to this is, if I've already taken a loan, and now I realize that it's too late, I'm stuck up now. I don't have any other source of income. How do I continue? In situations like this, I strongly recommend that you go back to the basics, senior income, see your expenses, see where all you can cut your expenses, and start making additional savings every month, perhaps you were making 25% savings of your income. Now, maybe you need to increase that to 30% 35% make additional savings so that you are able to accumulate a larger sum of money by the end of the year and slowly start paying off the loan.
When you start paying off the loan, you'll be able to wrap it up in four to five years and make a strong resolve never to take a loan again in your life. No rubber base loan, whether it's a personal loan, whether it is a car loan, whether it is a home loan, never take any rubber, be slow. Make a strong resolve.
I hope this is clear with you. So if you already into it, make a strong resolve make dua to Allah subhanho wa Taala asked his forgiveness make dua to him that Allah helped me to have my debts there is to offer the one who is under debt, make them go to Allah subhanho wa Taala reach out to him and make continuous Toba a continuous repentance to Allah subhanho wa Taala so that you don't, you should have the guilt that I have done something which is equivalent to waging a war against Allah and His Messenger sallallahu sallam. If I had to die in the state today, will I be able to fight the battle against Atlantis messenger alayhi salatu salam No. So I must make continuous Toba to Allah
and pray to Him because at the end, it is Allah who helps us out. Eventually all our problems can be resolved by Allah subhanho wa Taala. So reach out to him, seek His help and guidance and make a strong resolve never to again engage in blogs and Riba based loans. However, if you still not taken one, I will never buy this argument that there is no alternative. If there is no alternative, then move to downtown. If that's not an alternative, go to a smaller town, find a job which is maybe less paying, but at least you can stay respectfully, without borrowing money from a bank, you stay there with whatever you earn, and you pay interest. Allah has not restricted our source of income is open
the entire earth for us, we can travel wherever we want. I don't have to necessarily stay in Mumbai, or Singapore or in Hong Kong or in Dubai, and take loads because the cost of living is high. No, I can go to a German and stay for example, or I can go to Russell home and stay where I penis. Alright, I hope this answers the question. Now coming to the second part of the question. How can we structure a loan? Whoever has asked this question, I will request you to get in touch with me inshallah, how can we structure a loan this would be something which is very specific. I can't explain this in this session. All right. But we can certainly structure of product. If you don't
have an Islamic bank, we can certainly use contracts. We can draw up contracts, whereby people can come together and pull in money and they can become joint owners of property. For example. I'll give you an example.
My brother has money. My sister has money. I don't have a lot of money. I want to buy a property. So what I tell my brother and my sister is let's do something. I need a house. All right. Let the three of us go.
Join our resources and buy this property jointly, you know, when we buy jointly, then we are able to purchase it you put in 20 lakh I put in 20, you put in 20 I put in 20, my brother elder brother puts in 5090 lakhs I buy a property. All right. Now what I do, I stay there in that property
70 lakhs of the property out of the 90 lakh has been paid by my sister and my elder brother. So they have a larger percentage of shares in that property. So, for that percentage of share that they have, I will occupy the place and pay some rent to them. And every year, at the end of the year, we will review the price of the property, and I can keep buying some percentage of their share. So, I keep buying some percentage of the share of my brother, but because by the end of the year, the prices of property will go up. So, I will keep reviewing my contract every year. Because the valuations may have gone up. And then again, we really restructure another rent agreement like this,
there are ways to do it, you know, 10 people can come together six people can come together, they can jointly buy properties, we can certainly do it, there are ways to do it. The community has to work together with people should be genuine people working together. Unfortunately, that's not the case. We don't work together, each one of us is trying to seek our own selfish benefit. So if I'm in a group, I will always try to see how I am able to stand out rather than making the whole community stand out. I should I shouldn't be worrying about the person who's on the other side. But I'm more worried about myself, I want to get the importance. I want everyone to look up at me.
Okay, that is why we are never able to work as a community. We need to go back to the basics. So whoever's asked this question the brother or the sister, we can certainly restructure products, we can structure some products, tailor made products, how to do it to make it Sharia compliant. I will share the details when you get in touch with me separately, inshallah Allah.
Yeah. Okay. So now, the next question is about DVDs.
They're asking, okay, buying a house, please. Okay. So, for instance, there is one question is purchasing something like mobile business car, house anything on installments? halon. Islam? If yes, on what conditions? And what are the loans that governments give in order to install business? Whether that is helpful? And what is a safe way to get a house or car or anything on lease without a rubber if there is any, such a way? So they're all about these? Whether it is straight to a mobile, business, car, house or anything?
How can it be Helen? Okay, first and foremost, as far as
the first part of the question is concerned, how about the car lease, etc. The most basic principle in in Islamic banking or Islamic finance is that you cannot sell that which you can't own.
So the fundamental reason why conventional bank and Islamic bank differ are supposed to differ is that in Islamic bank, if I want to buy, let's suppose, let's suppose this is the car in my hand, all right, this is a car, all right. This is a car, I want to buy the car, if I go to a conventional bank, I tell the conventional bank, look, this car costs
a million rupees, and I don't have a million rupees. So what the car is, what the conventional bank does is no problem. Go ahead, buy it, we'll pay 1 million on your behalf. In return, you pay it back to us in three years, or five years over interest of 5%. So what has the conventional bank done? Did they buy this car for me? No. They didn't buy this car for me. I bought the car. What they did was they finance the monetary requirement that I had. And for that final monetary requirement that they finance against that they're charging or Riba and interest. What an Islamic bank would do. Again, I go to the Islamic bank, and so I don't need to buy this car. It costs 1 million. I don't have it.
have to first take ownership of this car.
They take the ownership, then they come back to me and they say that Listen, you wanted to buy this car. Now we own this car. We're ready to sell this car to you. This cost 1 million in the market, but I'm gonna sell it to you at 1 million plus 15% profit. Are they allowed to do it? Yes. They own the car. Look, this mobile belongs to me. If my route comes to me, and he wants to buy this mobile phone, it's my phone.
I can sell it to him at any price which I want. It's up to him whether he wants to buy or he doesn't want to buy
Once the possession is mine, I can sell it at any price I want. So the difference between Islamic bank and conventional bank is this, that the Islamic bank finances
rather buys the product, and then sells the product to you. And then they take money from you in equated monthly installments after fixing a profit and markup,
I hope this is clear. So this is if this is the kind of lease
for housing lease, for example, typically this works in a housing means it's called the murabaha setup, which is a markup, all right.
Yes, sir. This is like a mortgage and Islamic mortgage would work like this way. In conventional banks, the mortgage doesn't work like this, conventional banks never buy the property in the name, the property is bought by you.
They take it as mortgage in case where you are not able to pay, they have a right to take away the property from you and sell it in the market. But effectively, the registration is done in your name, the property ownership is yours. But in Islamic bank, the bank has to buy the property first, and then sell you so there are two transactions taking place. The first transaction with the bank takes the ownership of the property, the second transaction when it comes back to the client and sells it at a higher percentage amaco. Alright, so it's kind of police allowed, then there is a kind of a Charlie's what is an ijarah. lease era lease, typically you find it in car financing, where the
Islamic bank picks up the car in the name, and then they need it to you, you're allowed to move the car. And for using the car, they charge a rent from you. That's like the lease rent. So the Islamic bank is not sold the car to you, the car still belongs to the Islamic bank, but you're using the car. And then there are certain adjara contracts with guns with in Java and C joint. Which means at the end of the era contract of say three years or five years, I as a buyer, or as the person who had taken the lease will have an option to buy back the car from the bank.
If there are some kind of Islamic adjara arrangements, which are fulfilling the guidelines, both in letter and spirit, there's nothing wrong with it. All right. But again, to the questioner whenever you come across such loan agreements, try to get it verified go through the terms and condition if it is not clear to you ask the people of knowledge that's what Allah says in the karate if you don't know something, go and go.
Alright, so if you don't have the knowledge, you reach out to the ones who can help you out with this inshallah karma. I'm sorry, what was the second question?
Okay, so, by the way, also, I just realized, it has been a lot of time to be taken of yours. And there's so many questions as students that are very excited that they're getting so much information. I may request you for a second session, because it's very, very informative and very beneficial, even for me at hamdulillah. I'm just going to give you two more questions after this. The other
Yeah, one of the questions about Lee's was, what is the Okay, I think you've answered that a little bit. What is the safe way to get siding on the
bottom half again? Yeah.
Yeah. Okay. Um, what about Bitcoin?
Is it Hello? And why?
Yeah, so there's a this sister Kashmir from Pakistan and that woman from Buxton, have asked about it, why is it prohibited by Islamic scholars? And is it
okay, I'm sorry, I interrupted you. At this point, I'll just give you the ruling on bitcoins, it is not permissible to make any kind of investment in bitcoins, because there is absolutely no underlying assets which is involved at this point of time. Alright. Now I know that there is a lot of developments taking place in the field of bitcoins. There are a lot of people who are exploiting opportunities, using Bitcoin to invest into real estate markets, etc, so on and so forth. However, the opinion which I take is the one from Shane awesome. And Hakeem where he clearly says investing via Bitcoin is not allowed. It's not permissible. However, if you use the Bitcoin technology for any
other kind of advancement, which does not involve financial transaction, but it involves easing the way we deal with each other in terms of transaction and illustration. There's nothing wrong with that, however, buying bitcoins, we all know this was a hot topic a couple of years back, everyone was asking is Bitcoin allowed? They wanted a fatwa ASAP because the prices of Bitcoin was rocketing sky.
Hi, everyone wanted to buy bitcoin. And we were warning that it is not allowed it is not permissible there is absolutely no underlying assets backing that the rise in the prices of Bitcoin
and then eventually it reached a peak. And it's not it's falling down. And then there was no way that people could realize the money that they had made at one point of time. So it is better to stay away from such kind of speculation. Most of the things which is happening right now in Bitcoin is just speculation.
To get into more details of it and the technical details of it, we will have to take up this questions on email, and I can get back to you on that later in Charlottetown.
Does that go ahead and we will also request everyone to ensure they are in the oma group, the whatsapp group we will be sharing the brothers email inshallah there and other information as well.
I'll just ask one more question. I think you should have some break. In fact, for a day or so at least. So the question is about bond price bonds is purchasing price bond correct.
Then there's also a question about the difference between shares and bonds, mutual funds and shares and bonds these are constantly being asked.
Okay, well, I've heard about price bonds which is very common in Pakistan. Can someone just tell me how does it work?
you can take the mic access if you want, if you know how it works, according to whatever I have. I have studied about the price bonds, which are there in UK and what briefly I could find about what is being sold in Pakistan, etc. This is nothing but clear gambling. It is completely gambling. You are paying a sum of money. You Yes, exactly. It's lottery. It's absolutely a case of lottery. It is unlawful. It is massive. It is completely prohibited. So you are not allowed to invest in price bonds. Please don't invest in price bonds.
I know that recently, United Arab Emirates had an official Sharia compliant lottery, structural law. I have no idea what is that? I never knew there is a Sharia compliant lottery. If it is lottery, if it is following the principles of myself.
It is prohibited. It is unlawful. There is nothing called Sharia compliant. In fact, that is why I posted something a few days back on social media I asked people to tell me the difference between Sharia compliant Sharia tolerant and Sharia friendly because we find these terms being used in the Islamic banking and finance field. Some funds are Islamic Sharia compliant. So my Sharia tolerant, semi Sharia friendly. Wow Subhana Allah, it's not a Sharia compliant has got copyrights, you can't use it. Then why do you use Sharia tolerant? And what do you mean by Sharia practically? I don't understand. What is the meaning of Sharia friendly or Sharia tolerant? If it is not matching with
the Sharia guidelines, philosophy is not Sharia compliant. Alright, whether you call it solid and friendly and we come up with other
synonyms, it doesn't help coming to mutual funds and shares the difference and is it permissible to invest in them? Look, when you understand shares and you'll understand mutual fund shares simply means there are companies which are listed in the public stock markets, they try to reach out to the public to finance them to fund them. So they have the shares, it's out in the market, you pay for the price of the share and you get a percentage ownership of the share depending on the number of shares you have and the number of shares that are issued, that percentage ownership of the company comes to you. Naturally we people when we buy shares, we are the general market you know we are not
the major owners of the shake company, the major owners are the promoters of the company. Nonetheless, the system of share is where I become a partner. As good as a partner as good as an owner, a shareholder is all an owner of the company. So by becoming an owner, I get entitled to the profits of the company. And sometimes that profit is depicted through dividends which is paid at the end of the year, once in a year. And on a day to day basis that profit is reflected in the valuation of the share of the company. Depending on the demand and supply, you will keep seeing the prices of the shares fluctuating. The prices go up, prices come down.
So there is no risk which I have with my capital, my capital goes up my capital can go down as well. So I'm taking a risk
I'm an owner of a company is this not allowed? Yes, in principle This is allowed. However, there are conditions which have to be fulfilled, not only should the company be a halaal company or a Sharia certified compliant company, there are a lot of terms a lot of what you call ratios, which needs to be understood like the debt equity ratio, the exposure to debt, and there are fatwas of Murphy's lecture of money etc, which is very, which is befitting in the in the indo Pak scenario, which is often used by most of the scholars here. So, on that basis, if a company is listed in a Sharia compliant list, you can buy shares of those company, hold them, sell them when you feel the prices
have gone up.
Mutual Fund means a fund manager is there, you can buy shares individually, you are not an expert, so, you give the money to a fund manager and a mutual fund, the fund manager will now buyer the stock stocks or shares. That's the only difference. In case of shares you have individual shares allotted to your company. In mutual funds, you have a collection of shares, which is owned by a group of investors. So, each investors are given an equivalent unit. So both mutual fund is allowed and shares are allowed. However, the conditions have to be fulfilled, that they should be Sharia compliant companies that they should be meeting other Sharia compliant guidelines which are issued
from time to time by Sharia scholars. I'm not getting into the details of this because that is technical aspect, which many people will not understand and I do wish to confuse them. But in essence, you can invest in shares. You can invest in mutual funds, but not engage in intraday where you day to day buy and sell I buy in the morning and sell in the evening. That's not allowed. Because that's called speculation. When I do that, I'm not allowing the money to be with the company. I'm not letting the company benefit from that money. I'm not letting the company use that money in proper economic activity. Rather, I'm just trying to benefit on a day to day basis from the
slight price increase, which means there is no proper economic activity. The nation is not benefiting. It's only pure speculation. And Islam is against 100% speculation. This kind of speculation is extremely abhorred. Alright, so you buy shares, keep it for a long term, make your profit sell it and come up. That's allowed. Mutual Funds also allowed?
I hope that answers the question. Insurance, as I've told you all forms of insurance whether life insurance, health insurance, car insurance, other forms of insurance, all of them are prohibited. However, car insurance, I need it, because it's the guidelines of the government. If I don't have a car, or car insurance, I can't run a car I they'll take away my license will impound my car. So in order to make sure that I'm able to use the car, I need to take the basic car insurance. Alright, so I don't necessarily need to take a bumper to bumper cover, I can just take a third party insurance or whatever is the bare minimum I need to take in order to fulfill the guidelines I do that that is
alone. Can I take a health insurance therefore, because nowadays the health care costs are so high. Here again, as I've spoken to Chicago and Hakeem and other scholars, they say it's not allowed Sheikh Salim Guna Jude, by the way, says if you are in a country where the cost of healthcare is very high, and nowadays, you know that the healthcare costs and so on are primarily because of the insurance industry, the healthcare insurance industry's perhaps one of the reasons why the costs have gone up. Because these companies know these hospitals know that most of the money is going to come from the insurance company. So that's why they have created put a big premium on the facilities
and services in countries like this. And nowadays, since people don't have that joint family system, and the feeling of camaraderie and brotherhood is not there. Everyone lives in a nuclear family with selfish interest. I love my brother, but I can't pay him money when he needs it. I love my sister. But even if she needs money, I'll be a little, you know, I think 10 times over before giving money to environments like this. If you need to save life, if you need to protect life. Some of the scholars say you can take a health care cover because the need to save life is more important. A and B health insurance is not God webinar. It's got her in it. And Reba has a strict prohibition over
her. So that's why they allow it but life insurance not allowed. Because the there is absolutely nothing related to life insurance, health ethics or trying to save a life. But with life insurance, it is strictly prohibited you're not allowed to take it. So again, as I said, you will find differences in opinion among scholars in these views. Yeah, just I share with you
does love hearing cathedra for the neola era for giving us so much of your precious time and energy, this was utterly beneficial and informative. I also was meant to reward you and honor you immensely in both worlds inshallah Allah. I will discuss with you how you like to answer the rest of 40 to 60 plus questions. We will also share your email address with the students in the group I hope and pray that we all implement this knowledge where we are not going to be asked how much knowledge we had, but what did we do with that knowledge? Does that mean the hair everyone great attendance, so monocolor Ma, sha Allah Allah Allah,
Allah, Allah, He will bracket