WHAT TO DO WITH INTEREST MONEY

Now a days because of the danger of theft and other uncertain conditions prevailing in the present circumstances, it has become riskful to keep large amounts of money at home. Also honest and trustworthy people are unavailable to be entrusted. Certain legislative problems are also there to force us to have a bank account. All these problems in this country have made inevitable for almost everybody to open his account in the bank. Therefore, it is now allowed to open a bank account. But the problem is still there what to do with the interest money credited in the account. If the depositor accepts the interest money he commits a grave sin and if it is not accepted it may be used in anti-Islamic activities or in strengthening the power and financial position of the elements working against Islam arid Muslims which will be ultimately harmful for Islam and Muslims and in such a case the person not accepting interest may be regarded as being indirectly helpful in this act.

For a situation like this the jurists have made a rule that if someone is exposed to two troubles both involving sin then he should choose that having lesser degree of sin (Al-Ishbah-wan-Nazaair). Since to accept interest is a sin lesser in degree than that of harming Islam and the Muslims, therefore, the jurists recommend to accept interest in such a situation. But since this money being an interest money is unlawful and a person occupying unlawful money cannot become its owner, therefore legally it will be owned by the real owner who pays interest. If this real owner is known and can be located without great difficulty as is the case of a single person or a group of a few persons easily accessible, it must be returned to him/them. But if it is very difficult to find out the real owners as is the case of interest earned from the bank which is an organisation owned by many owners, share holders, its customers, etc., and the interest is owned by all of them, then the jurists say that in such a case it is expedient (Waajib) to give this interest money in charity (sadqah) on behalf of the real owners.

In other books of Fiqh like Imdad-ul-Fataawa part 3, Fataawa Dar-ul-Uloom volume 7-8, it is written that it is necessary to draw the interest money from the bank and distribute it among the needy and the poor. When the jurists declare a charity to be expedient without restricting it to be jariyah (that which is continuously rewarded by Allah Ta’ala, it remains no more beneficial for the people) or Nafilah (that which is not compulsory), it is essential to give that charity to the rightful poor on which Zakaat can be utilised. It has been fully explained by Hadrat Mufti Muhammad Shafi in a treatise in Fataawa Dar-ul-Uloom.

Allama Haskafi (R.A.) writes in Uddur-ul-Mukhtar (Kitab-ul-Luqta p.330) that if someone occupies anything which was acquired by loan or oppression and its owner is not known with no possibility of his being known its future, it is incumbent for him to give that possession in charity even though all of his possession is spent in this charity. After this charity is given on behalf of the right owners they will not demand him their right on the day of judgement.

Allama Shami making comments on this statement writes that the poor and the needy are the proper places for the utility of this charity. By repentance, he will be forgiven the sin of oppression alone not the right of the owners which will be forgiven only if this unjustly acquired money is spent in charity on behalf of its owners (Shaami). Therefore, it is necessary to give this money to the people who deserve Zakaat and it is not lawful to spend it on the construction of toilets, roads and other public welfare works just as Zakaat fund cannot be utilised on these places of expenditure. Also since this money is being given in charity because of not being able to return it to the real owners, it is quite lawful for the needy to accept it without any feeling of dislike and they will not be regarded as those who devour interest or unlawful money. Mufti Muhammad Shafee (D.B.) referring to Fataawa Bazzaziya has stressed that the poor and the needy must be made the owner of such money. It is not lawful to spend it for Madaris-e-Islamiyya (Islamic Schools), trusts or public uses.

The Chief Mufti of Dar-ul-Uloom Deoband Hadrat Mufti Mahmood Hasan Gangohi writes in a reply to a question that if it is difficult to return the unlawful (Haraam) money to its owner or the inheritors because they are not known, it becomes obligatory to give it in charity (sadaqah). To spend it in places referred in the question is not appropriate as has been clarified by Allama Shami and also written in Kitab-ul-Asaar by Imaam Abu Yusuf (R.A.).

In short the interest money must be drawn from the bank and divided among the poor and the needy Muslims making them the owners of this money not in order to obtain reward but to remove the damages of the sin of interest. However, we hope from Allah Ta’ that because of carrying out His commandments He will not deprive us from the reward and His bounty.

And Allah Ta’ala Knows Best

Mufti Ismail Kacholvi
Bradford, UK

Last modified: July 19, 2007

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