Q294 :Now that we are certain that bank interest is
forbidden in Islam, the question arises: how can a Muslim invest his
savings? If he lives in a country where there is no Islamic banking
facility, the alternatives available to him are either to use a deposit
account which earns interest or entrust some businessman who will be
happy to use this money in his trade. However, this method is not very
satisfactory, especially with the increase in the number or
bankruptcies and fraudulent dealings among such people. Could you or
other Islamic scholars show us any halal, or permissible way of making
use of our savings?
A294 : I admit at the outset that this is a thorny
question, for which I have no ready answer. I certainly appreciate the
desire of every person who has made some savings to invest them in a
permissible way which ensures some good returns, at least to offset the
loss he is bound to incur as a result of inflation. It is a certainty
that money which is left in a current bank account loses part of its
value as a result of inflation and higher prices. Hence, the need is
pressing for a good investment at least to ensure that such saved money
retains its value. The problem of investors is again a very real one.
The number of bankruptcies and fraudulent dealings is sufficient to
make anyone who has earned his wages through hard work very reluctant
to entrust those savings with any investment netpany. The situation has
not been helped by certain governments which have dealt a blow to the
very concept of using people’s savings in order to start profit making
projects which help the economy of the country. They have advanced
reasons for their action but their reasons remain dubious. Therefore,
the original question of how to invest remains without a satisfactory
answer. But I should take issue with you regarding the way you have
phrased your question. It is not the business of a scholar to show you
a way to invest your money in an Islamically acceptable way. There may
be none available. It is wrong to assume that a scholar can provide you
with one. It is the responsibility of an Islamic government to provide
opportunities to its subjects to invest their money without
contravening the teachings of Islam. If the government does not take
care of such important matters, the Muslim netmunity in general should
do something about it. If they do not, then they are neglecting an
important area and negligence may lead some of their numbers to netmit
a sin. It is sufficient that some people in the netmunity should
provide a practical answer. This is what the pioneers of Islamic
banking have tried. If some such projects have failed, others have
succeeded. Moreover, the very Islamic concept of such investment is
based on a sharing of profit and loss. Besides, the failure was not
entirely their own responsibility. There were pressures from usurious
financial institutions in the capitalist world as well as internal
pressures from forces which do not like to see an Islamic economy
flourishing. That should not deter people from trying again. The only
practical way that I can suggest is to try to find a businessman whom
you can trust to be honest and God-fearing. You enter into a
partnership with him on profit and loss sharing basis. Alternatively,
you can join others who are in a similar situation and buy something
for future sale which is highly unlikely to make a loss, such as real
property. The other alternative is the opportunity provided by the
Islamic banks. If there is none in your home country, you may be able
to open an account with a bank in a free trading country.
Our Dialogue ( Source : Arab News – Jeddah )