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Private Company Provident Fund (PF)
As’salam o alaikum,
I am working in a private company. The company deducts 10% of basic pay every month and add to it the same amount and park it in PF. The PF is invested in various companies/schemes (halal businesses) but a portion of the PF is also placed in “interest-based bank accounts”.
Upon retirement the total amount i.e. my actual deduction plus the same amount contributed by the company plus the earnings (including interest from “interest-based bank accounts”) is returned.
1) I DON’T have the option to opt out of this fund
2) I DO have the option to STOP my PF investment and receive only twice the actual deduction (my share + equal contribution by the company) without any profit (both from “interest-based bank accounts” and halal investments)
3) The PF with or without profit can be received only upon retirement
4) PF can also bear a loss (it has actually happened once in my 15 years career)
5) At retirement, I can only know a) my deductions b) company contribution and c) the total earnings. BUT not the breakdown of earnings to know the share from “interest-based bank accounts”.
I think that my deductions and company contribution (sort of a gift) are HALAL. What about the profit over PF as part of it is from “interest-based bank accounts”?
Thanks and jazakALLAH,
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1 Reply
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Private Company Provident Fund (PF)
updated 2 years, 10 months ago
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kindly refer to following video
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