Is working in Bank forbidden (HARAM) in Islam?

[کیش]

how is that any different than charging interest??

Because the bank is making an investment to the company and actually cares for the health of it. Compared to normal banks who don't care if the company goes under and is only concerned about receiving monthly payments plus interest. They also don't make harassing phone calls and threatening emails if you don't pay up.

[faye]

in our banks, we used to get some of the interest but now it is all us paying fees.

[کیش]

Riba is a grave sin; warned by god numerous time thought history. Don't let the ubiquitous nature of interest give you duping approbation of the transgression.

The Prophet witnessed the penalty of the people involved in interest, and explains the punishment in clear words in a Hadith. I believe the guilty were swimming in a pool of blood while people throw rocks on them while they attempt to abscond.

[Badlun]

What is prohibited by Quran is Riba(usury) not interest. Riba is forbidden as it is an unethical profit and Islam being a complete religion has taken care of this moral aspect of financial transactions.

I would like to see some one to challenge the contents of this site. Here are few excerpts.

The word ‘riba’ as appearing in Holy Quran is translated in English as ‘usury’ by some translators and as ‘interest’ by few. In Arabic language, it literally means an "increment” or “excess" but in essence it means unfair advantage or profiteering, which is prohibited by Allah (swt). For instance giving RS. 4800 for change of a RS. 5000 currency note would be riba, even though there is neither interest nor increase. Usury is not only unfair advantage but also excessive and wicked charge of interest and is condemned by Bible and Quran as also other faiths.

Conventional Bank Interest and Profits

Banks provide a variety of financial services much different than the greedy and professional moneylenders and pawnbrokers of ancient times. Governments and laws lay down stringent requirements for their solvency and paid up capital and monitor and regulate their operations.

When the bank pays you interest on your deposit they pay you out of their overall profits. When the bank charges you interest on the loan they charge it as the substitute for profit that they would otherwise make by investing in share market, real estate etc. Al Azhar's verdict for paying pre-determined profit (interest) is apparently based on the principle of pooling the overall profits of the bank on all types of investments plus their own flat fees for account handling, lockers, guarantees, monetary transfers etc. instead of the cumbersome and expensive procedure of sharing profits and losses under each transaction of debt separately. But Al Azhar's plea for Qarze Hasana (loan without interest or obligation to repay) to the poor and needy, is not commercially viable and only philanthropic and charitable institutions could do that or the government can do that on the lines of social security benefits for poor in US and Canada.

Bank interest rate about equal to or less than likely profit on
investment of the same amount as loaned cannot technically or logically be regarded as taking unfair or unethical benefit and thus it cannot be treated as usury/riba.

It may be noted that under the sharia compliant modes of financing one often ends up paying higher profits to the lender than the regulated bank interest and the reason is said to be that risk of loss is there for the lenders. In view of the modern risk appraisal methods for granting loans and the laws that protect the interests of the borrowers and lenders it can safely be said that modern banking as regulated by the laws is serving the needs of the business and consumers in much better way and more economically than any other method in history.

The Islamic theological research committee of Egypt's Al-Azhar institute - seen by many as the philosophical center of the dominant Sunni strand of the faith - has in the recent past voted 21-1 to approve fixed interest rates or pre-determined rate of profit.

Interpreting Verses of Holy Quran

004.161: That they took usury, though they were forbidden; and that they devoured men's substance wrongfully;- we have prepared for those among them who reject faith a grievous punishment.

The words "devoured men's substance wrongfully" indicate exploitation. Logically nominal bank interest can not be deemed to be devouring men’s substance wrongfully.

002.278: O ye who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers.

002.279: If ye do it not, Take notice of war from Allah and His
Messenger: But if ye turn back, ye shall have your capital sums: Deal not unjustly, and ye shall not be dealt with unjustly.

In verse 2.279 the words 'Deal not unjustly' refer to exploitation

003.130
YUSUFALI: O ye who believe! Devour not usury, doubled and multiplied; but fear Allah; that ye may (really) prosper.

PICKTHAL: O ye who believe! Devour not usury, doubling and quadrupling (the sum lent). Observe your duty to Allah, that ye may be successful.

SHAKIR: O you who believe! do not devour usury, making it double and redouble, and be careful of (your duty to) Allah, that you may be successful.

In verse 3.130 the words doubled and quadrupling are important in arriving at the definition of Riba. Does it mean that until the riba
reaches the level of double and manifold it can be taken? Probably not but it does indicate excessive charge.

The Differences between Riba and Interest

[khushal]

how is that any different than charging interest??

Interests is guaranteed profit that the bank will receive and what quais describes is that the bank will share in the profit and loss. Interest is usery because even if the recipient is losing his business the bank gets a guaranteed profit and goes after the recipients assets transforming the recipient into a penniless slave. If the bank is regarded as a shareholder in the business, it will be more careful when making the loan and also will lent support when the business is in trouble. If the bank becomes a monopoly and is "too big to fail," it will hold the public as hostage for it to bail them out when need be, so in essence if they lose money, the public will bail them out and when they gain money, it is theirs which is again usery-->guaranteed profit.

[khushal]

in our banks, we used to get some of the interest but now it is all us paying fees.

Same here. The banks cant pay interest because the government is artificially keeping interest rates low to encourage borrowing and spending so instead the banks have adapted into charging fees to make up for the lost revenue.

[khushal]

Banks, modern economy etc... are probably all haram, especially since they are coming from non muslim economic systems. some times I think we will all get destroyed soon, because we are all doing haram willingly or without our knowledge. Only some communities living in isolation will be saved

Banks existed during the caliphate. you could have actually wrote a check in Spain and cashed it in Baghdad. Banks are not haram themsleves, usery is.

[Admin Khan]

Working at a bank where you are advocating and promoting interest is both unacceptable and Haram.

[khushal]

Working at a bank where you are advocating and promoting interest is both unacceptable and Haram.

Banks are involved in all businesses and governments. The whole system revolves around interest. A large chunk of the taxes we pay goes to paying off the interest of our government's loans.