Banking: Borrowing from Banks and Dealing with Ribā Without Necessity

Practical Laws of Islam as per the teachings of Imam Khamenei

Banking: Borrowing from Banks and Dealing with Ribā Without Necessity

English:

Question #1896:

Is it incumbent on the person who borrows money from the banks to ask the permission of authorized religious authority, or his agent when the bank demands payment of ribā? And is it permissible to borrow without any pressing need?

Answer #1896:

In essence, borrowing, even if it is from a state bank, does not require the permission of an authorised religious authority. As to loan contracts per se, they are valid, even ribā-based. However, if ribā-based, as a matter of religious duty it is ḥarām to embark on them, irrespective of whether you get it from a Muslim or a non-Muslim, an Islamic state or a non-Islamic state. The only leeway is circumstances of extreme necessity where committing a sin can be tolerated. No ḥarām borrowing can become ḥalāl with the permission of an authorized religious authority. Indeed, there is no case for permitting it. However, in this case there could be room for doing away with the ḥarām aspect, i.e. by not intending to pay the extra amount, albeit the borrower may know that the bank is going to charge him anyway. The permissibility of a ribā-free loan does not hinge on the circumstances of necessity and need.

-Imam Khamenei, Practical Laws of Islam, Importance and Conditions of Banking