Jump to content
In the Name of God بسم الله

Fixed Income vs Equity Roles

Rate this topic

Recommended Posts

  • Advanced Member

Salaams brothers and sisters,

In the world of investment banking, are there any jurisprudential downsides if one decides to apply to a fixed income rather than equity role, given one will be propagating debt and interest instruments?

JazakAllah for your time.

Edited by FarmandeIsMahdi
Link to comment
Share on other sites

  • Advanced Member

Salam generally investments in non-Muslim banks for receiving interest likewise  "a fixed income"  but on the other hand investment for receiving interest in Islmic Banks must be done through observing religious deals (Sharia contracts).

According to Ayatollah Makarim Shirazi 

Question:Taking interest from non-Muslim banks Question: Is it possible to receive interest from non-Muslim banks?

Answer: There is nothing wrong with taking interest from foreign and non-Muslim banks, but it is forbidden from Muslim banks, if it is not according to Sharia contracts.


گرفتن سود از بانک های غیر مسلمان

پرسش : آیا می توان از بانک های غیر مسلمان سودی دریافت کرد؟
پاسخ : گرفتن سود از بانک‏هاى خارجى و غیرمسلمان اشکال ندارد، ولى از بانکهاى مسلمان، در صورتیکه طبق عقود شرعیه نباشد حرام است.

Investing in foreign stock markets


Question: Is there anything wrong with investing in stock exchange companies abroad?
Answer: There is no problem if the investment is in a legitimate place.


Islamic Bank's recognition criteria


Question: What is the criteria for identifying Islamic Bank?
Answer: It is that all its programs are according to Islamic contracts, and where the bank implements both Islamic and non-Islamic banking methods, there is no obstacle if he uses the services of the Islamic banking sector.




According to Ayatollah Noori Hamedani


Q 472 - Is it permissible to take interest from a Muslim bank? What about non-Muslims?

A: If he makes the bank his agent so that the bank operators use the money which they receive from individuals in economic processes and divide the profit between themselves and the owners of the money capital, there is no problem in taking interest, and taking interest from non-Muslims does  not a has a problem.



Q 475 - What is the form of putting money in foreign banks and receiving interest from them?

Assuming that it is permissible to receive interest from foreign banks, since saving in foreign banks strengthens the infidels and their economic domination and weakens the economy of Islamic countries, what is the ruling on the issue?

A: If it causes economic dominance over Islamic countries or economic weakening of Islamic countries, it is forbidden.

According to late  Ayatollah Behjat (رضي الله عنه) 


"2292" It is permissible to take money from non-Islamic banks, such as banks of infidel countries, whether it is governmental or private, but not as a loan; And taking possession of it does not require the permission of the ruler of Sharia or his lawyer, unless it is a Muslim's property in the bank of the infidels, who must perform the special duty that was said about the banks of Islamic countries regarding that Muslim's share. Ayatollah Behjat's Treatise on Explanation of Matters.

It should be noted that Ayatollah Sistani differentiates between governmental and private banks


Question: What is the ruling on depositing with interest in the bank, especially for those who are retired?

Answer: Banks and governmental institutions, according to His Holiness, their property is  unknown ownership, and it is permissible to seize it with the permission of the ruler of Sharia. Therefore, on the assumption that the depositor does not make a profit, if he is given a profit, they allow  to possess that unknown owner profit. They should own the property on the condition that they give half of the profit to the pious poor as charity.

And as for the profit of banks and non-governmental institutions, it cannot be owned in any way, but if a person knows that the owners of capital are satisfied with his possession of this property, even if he is not the legal owner - which is often the case - he can possess it, and if he purchased something with it so then he becomes the owner.

And this is if the bank does not make a Sharia transaction with the depositor, but if the Sharia transaction is correct in compliance with the conditions and it is possible that the bank will perform a Sharia transaction according to the contract with the amount of the deposit, the interest is permissible.




Link to comment
Share on other sites

  • 3 weeks later...

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.

  • Create New...