Can Muslims work for banks or financial institutions? Would income earned from these sources considered to be haram?
Wa Alaikum Assalaam,
الجواب و بالله التوفيق
In general, transactions, borrowing and lending, financing etc. which are done at Banks and Financial Institutions are all directly and indirectly connected to interest/usury (Riba) which is totally Haram (forbidden) in Islam. In fact, the major source of income for a bank/financial Institute is interest.
In this respect, the great scholar Mufti Khalid Saifullah Rahmani has written, ‘Work and transactions in the bank are based upon Riba (interest), and interest based work and transactions are all Haraam. The Messenger of Allah has cursed one who takes interest; one who pays interest; one who writes a transaction of interest; the witnesses who witness such transactions and those through whom such transactions take place’ (Abu Dawood; Tirmidhi; Ibn Majah). The reason for such ‘curse’ is that all the above mentioned individuals are rendering assistance to interest based transactions. Those who work at the bank are involved in documentation and accounting, and in all other activities of interest based transactions. Hence, they fall into the different categories of those who have been cursed in the hadith, and are direct helpers and supporters of this grave sin. It is therefore, not permissible to work at the bank.’ (Kitabul Fatawa Vol. 5 Pg. 392 Zam Zam Publishers Karachi 2008).
Many other great scholars and leading Muftis have also given the same Fatawa (verdict) regarding working in the bank. These are all documented in their respective books of Fatawas.
Therefore, when working for such Institutions are considered to be Haram, then the income earned from these sources will also be Haram.
And Allah Knows Best.
Mufti Waseem Khan.