Question: My question is about taking loans from the bank. A muslim brother told me that it is allowable to take a loan from the bank. This is based on the argument that muslims require conveniences like for example a car, a house, etc. and the only way possible is through a bank loan. I informed him about Clico Muslim Banking before he goes to the bank. The brother said that he got this information from Darul Uloom. Can you shed some light into this topic please.

Answer: The conventional banks are all involved in the giving and taking of interest which are prohibited in Islam. Hence, if one goes to do a loan transaction with them, he has no choice except to pay interest upon the loan. In this case, a Muslim will be intentionally dealing in interest which is a major sin in Islam. It is for this reason, all the sound and authentic scholars of Islam of our times have ruled that it is not permissible to take loans from a bank.

As for the fulfilling of one's convenience and comfort, this is not a requirement in Islam, hence, one will not be allowed to break a law in Islam for the sake of fulfilling a convenience. If one has the means to achieve convenience without doing anything Haram, then it is allowed and acceptable. However, there will be no allowance to violate a law of the shariah in order to fulfill that which brings about a convenience.

If however, one wishes to fulfill a dire need/necessity and the only way is that of going to the banks, then it will be allowed to the extent of fulfilling one's dire need. This can only come about when one has exhausted all the other means of fulfilling the said need, and that the need must also be a real one which is not made up. If the individual has tried all the different ways of getting help and was not successful, and the only way is that of turning to the bank to fulfill a real dire need, then one can do so. If one has been forced to do this, then he must take only that amount which is needed to fulfill the pressing requirement, and must try his best to pay the loan as fast as possible, in order to get out of this unlawful transaction.

Note : This transaction remains an unlawful one and does not become halal. An allowance has only been given to fulfill a burning need so that one may not be put to unbearable hardship. An individual therefore, must be very honest and truthful at heart in deciding whether there is a dire need or not in taking a loan from the bank.

In order to stay away from this unlawful transaction, the brother can try to get the money borrowed from another Muslim brother or can go to the MCU or the Islamic Investment bank at Clico.


And Allah knows best.
Mufti Waseem Khan