Opening Bank Accounts

Apr 23, 2024 | Banking/ Interest

QUESTION:

It is not permissible to intentionally accumulate interest money.

1. If a person has an option at a bank to open a bank account whereupon one does not accumulate interest but opts for using another account, will this be considered as intentionally accumulating interest?

2. Similarly, as in the above scenario, if a person chooses to open an Islamic account on which there are “profit shares”, will this be permissible?

3. If a person opens an account on which they will receive interest (and with the intention to dispose of it), will it also be considered as intentionally accumulating interest?

4. If one opens a bank account (merely in name), and someone else puts their funds in it and uses the account, will the one who opened it be responsible for ensuring that the interest is given away and bank charges are paid, or will it be the responsibility of the one whose funds are in the account and who is using it to take care of it?

5. If one person opens an account in their name so that someone else can use it, and the one who opened it wants to close it (for responsibility reasons-signing documents, going to the bank to sort out issues, etc.), may the one who uses it refuse to take out their funds? Will the ruling differ if they are a parent or spouse?

ANSWER:

1. Yes, it will be considered as though he has opted for the interest account to intentionally accumulate interest, unless he has a valid Shari’ee reason for doing so.

2. We have not approved of any profit-sharing accounts.

3. There is no need to open an interest-bearing account with the intention of disposing of the accumulated interest.

4. If the account holder hands the account over to the other person (as he is perhaps unable to open his own account) with the condition that he will pay all charges, dispose of any interest accumulated, and he agrees to the conditions, then the account holder will not be liable.

5. The account holder is free to stop the other person from using the account if he is not willing to do so, particularly if he fears being implicated for incorrect transactions or he fears some danger.

ALLAH TA’ALA ALONE KNOWS BEST!

ANSWERED BY:

Mufti Mohammed Desai

Date: 14 Shawwal 1445 / 23  April 2024

 

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