Islamic View on Monthly Bank Profit

Answer:
Currently, the Islamic banks in our country that claim to operate according to Shariah do not properly adhere to Shariah principles in their investments.

Therefore, until it is confirmed that these banks are strictly following Shariah guidelines, it is not permissible to deposit money in DPS, FDR, or any other savings accounts in these banks and receive additional returns.

 

2. Is it permissible to receive profit or returns from FDR and DPS where a fixed amount is deposited for any term in conventional or Islamic banks? A solution with evidence from the Shariah is humbly requested.
 

Answer:
It is not permissible to open fixed deposits or other savings accounts in conventional banks and enjoy the so-called profit earned from them.

Because such profits are essentially interest (riba), which is clearly prohibited (haram) by the Quran and Sunnah. The same ruling applies to mobile financial services (e.g., bKash) in our country.

Although the so-called Islamic banks in our country claim to follow Islamic principles on paper, in reality, they do not operate in compliance with proper Shariah guidelines. Most of their investment activities are not conducted according to Shariah-compliant methods.
 

Even their transactions with depositors are not fully legitimate. Anyone with proper understanding of Fiqh al-Mu’amalat and the existing banking system will not find these matters unclear.

Another major proof that their operations are not Shariah-compliant is that many Islamic banks have reached near-bankruptcy due to fraudulent and illegal transactions.
 

Therefore, it is not permissible to deposit money in Islamic DPS and enjoy the money given as profit. It is necessary to avoid this.

For those who wish to follow the halal-haram guidelines, refraining from accepting such profits is recommended. Donating such money (received as profit) as charity (sadaqah) is the safer option.

 

Ruling on Conventional Banks and Mobile Financial Services in Islam

In banking, there are four major types of deposit services:

1. Current Account,

2. Savings Account,

3. Fixed Deposit Account (FDR), and

4. Locker Services.

From an Islamic Shariah perspective, the rulings and permissible uses of these vary.

1. Savings, FDR, and DPS Accounts

Although banks classify these funds as "amanah" (trusts), from a Shariah perspective, they are considered loans (qard), not trusts. The reasons are:

• Obligation to Return Funds:
  According to Islamic law, in a trust, the holder is not liable for the funds unless negligent. However, in banking, the bank (recipient) is always obliged to return the money, which aligns with the characteristics of a loan, not a trust.

• No Identical Preservation:
  In a proper Shariah-compliant amanah, the entrusted item must be preserved exactly as it is. But banks invest the deposited money in various sectors rather than keeping it intact.

2. Ruling on Savings and FDR in Conventional Banks

Depositing money in savings or FDR accounts in interest-based (conventional) banks is not permissible under any circumstance.

• Interest-Based Contract:
  These accounts fall under direct interest-bearing contracts, which are explicitly prohibited (haram) in the Qur'an and Sunnah.

3. Ruling on Current Accounts and Locker Services

• Current Accounts:
  It is permissible to use current accounts as needed because no interest is paid on the deposit; in fact, service charges may be deducted. It can be used for the safety of one's wealth.

• Islamic Current Accounts:
  Preferable and superior. If your needs can be fulfilled by using a current account in an Islamic bank, there is no justification for using a conventional bank.
  (Note: If a current account offers profit or interest, it is not permissible.)

• Locker Services:
  Considered a legitimate amanah. Renting a locker (metal box) for storing valuable items is treated as a trust in Shariah.

What to Do If You Have Deposited in an Interest-Based Bank by Mistake

If someone, out of ignorance of Islamic rulings, has deposited money in a conventional bank, they should:

• Close the Account:
  Immediately close the interest-bearing account and withdraw the principal amount.
  The principal amount is halal and may be used.

• Interest Money Usage:
  Any additional money earned as interest must be taken without the intention of reward.

• Donate or Spend for Welfare:
  This interest money should be donated to the poor and needy, or used for public welfare purposes, without expecting spiritual reward.

• Prohibited Uses:
  It is not permissible to use this money to pay interest in other banks or accounts.
   

Sources:

• Bada’i al-Sana’i, 4/426

• Al-Ma'ayir al-Shar'iyyah, pp. 156, 210–216, 242–255

• Majallat Majma' al-Fiqh al-Islami, No. 5, 2/1539, 1599; No. 12, 1/697
   

Provided by:

Fatwa Department, Markazud Dawah Al-Islamia, Dhaka
(Research-Based Higher Islamic Education and Da'wah Institution)