Banking: Depositing Money Solely to Receive Fixed Interest**
Practical Laws of Islam as per the teachings of Imam Khamenei
Banking: Depositing Money Solely to Receive Fixed Interest**
English:
Question #1924:
Banks pay depositors monthly interest. This interest is fixed even before the money is invested. Furthermore, the depositor does not bear a loss. So, is it permissible to deposit money for the purpose of getting the interest or is such a transaction ḥarām because it is ribā-based?
Answer #1924:
If the money was deposited in the savings account as a loan while the transaction is based on interest, or it is stipulated to get interest; this clearly is a ribā-based loan that is ḥarām as a matter of religious duty. Any profit to be made thereof is ribā that is illicit. Alternatively, there is no harm in depositing the money with the bank for investment in a shar‘ī and ḥalāl transaction. Fixing the rate of interest before investing the money and non-sustainment of any expected loss by the depositors are immaterial to the validity of the provisions of the contract.
-Imam Khamenei, Practical Laws of Islam, Importance and Conditions of Banking