Banking: Depositing Funds for Shar‘ī Investment Without Specified Profit Share

Practical Laws of Islam as per the teachings of Imam Khamenei

Banking: Depositing Funds for Shar‘ī Investment Without Specified Profit Share

English:

Question #1910:

Is it permissible to deposit money with a bank and authorize its officials to invest the same in any shar‘ī transaction without demanding a specific share of the profits, but on the understanding that the bank would give the investor his share of the profits every six months?

Answer #1910:

There is no objection to this type of deposit if the money is left with the bank with unrestricted freedom, i.e. even choosing the type of investment and specifying the investor’s share of the profit on their behalf. Nor is there any objection to taking the profit made by investing the money in a legal transaction. There should also be no problem if the investor was ignorant of the size of their share of the profits at the time of depositing the money.

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