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Investment In Banking Departments
Assalamu Alaikum
All of the banks, at least in western countries, earn money through interest on mortgage, car loans etc etc. In other words, on such things which are usable in nature and not consumable. Correct me if I’m wrong.
That type of interest is totally halal. Would it still be haram to invest in banking stocks, if one considers to donate an approximate part of the stock earning equivalent to the percentage bank earns through haram interest. E.g. if 20% of a bank’s earnings come throgh haram interest then one can donate 20% of his stock earning?
To be on the safer and more pious side, one can still avoid stocks, but in index funds one doesn’t have a lot of choice. Almost all good index funds have bank stocks in them. Can/should one donate some approximate percentage of his money according to the calculation above?
JazakAllah
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1 Reply
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Investment In Banking Departments
updated 3 days, 3 hours ago
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Mortgage financing is halal; there is no issue with it in principle.
Investing in stocks is also halal, provided that the investment is not made in companies whose primary business involves something haram, such as alcohol.
If a company has a minor involvement in haram activities, the impure portion of the income can be identified and given away in charity as a means of purification.
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