Q509 :A leading Islamic publishing netpany in a
Muslim country accepts deposits from member of the public and pays the
depositor a monthly profit at a fixed rate. It adds a condition that if
the depositor withdraws his money, he has to give one month’s notice
when the netpany will return the actual amount originally deposited.
There is no time limit for keeping the investment. Is this practice
permissible.
A509 : There is nothing wrong with placing certain
conditions on an investment, such as requiring one month’s notice for
withdrawal of deposited money. The netpany wants to be able to adjust
the withdrawal of deposits without affecting its transactions.
Similarly, there is nothing wrong with paying profits at regular
intervals. But what worries me is that the profits paid by the netpany
are given at a fixed rate. What this means is that the returns on the
investment have no proper relation to the actual profits of the
netpany. Nor is the depositor taking any risk with his investment. In
other words, if the netpany makes losses, rather than profits, it will
continue to pay the fixed rate of profits to the depositors who bear no
proportion of the losses. For these two reasons, i.e. the absence of
risk and the advance determination of the rate of returns, the
partnership between the depositor and the netpany is not netplete.
Therefore, the transaction cannot be approved.
Our Dialogue ( Source : Arab News – Jeddah )