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Resolutions of Iftaa' Board

Resolution No.(53): “ Ruling on Awards Offered by the Islamic Bank in Accordance with a Particular Mechanism“

Date Added : 02-11-2015

 

Resolution No.(53): "Ruling on Awards Offered by the Islamic Bank in Accordance with a Particular Mechanism“

Date: 8/8/1422 AH corresponding to 24/10/2001 AD

 

The Board recieved the following question:

What is the ruling when the Islamic Bank offers incentive awards to clients, who have investment accounts, in accordance with a particular mechanism (volume of the account, duration, added sums, and stability of the account)? How can we define the relation between the above clients and the Islamic Bank in light of these awards: a contract or an independent initiative on the part of the bank? If it is a contract, is it binding or not?

Answer: All success is due to Allah.

The Board of Iftaa` is of the view that it is permissible for the executive board of the Islamic Bank to distribute cash or in-kind incentive awards on these clients, and to cover their expenses in Hajj (pilgrimage) or Umrah (minor pilgrimage) or the like, if it is entitled to do so, provided that these awards are covered from the bank`s own earnings.

Moreover, it is impermissible for the bank to cover these awards from the total of the investment profits because this entails giving a portion from the share of the owners of these accounts as a sort of contribution, and this is forbidden in Sharia because the Mudarib (bank) isn`t allowed to give from the money of the Mudarabah (co-partnership), except with the permission of the owners (clients who have investment accounts). If they allow that, then it is permissible for the bank to cover these awards from its overall profit. In this case, offering these awards is considered a donation/grant on the part of the bank, and becomes a binding promise if it had made an announcement about that earlier. In addition, it can`t be considered a condition in the Mudarabah contract between the bank and the owners of the investment accounts because some of them may receive awards; whereas, others may not.

In this case, the board of directors enjoys the authority to lay down the legal terms and regulations pertaining to giving these awards (volume of the account, duration, added sums, and withdrawals), and to determine the type of the investment account (savings, deferred etc.) eligible for that, whether to all clients or to some of them.

Moreover, it isn`t permissible for the bank to distribute these awards on the owners of credit accounts (current accounts) for there is a suspicion of Riba (usury) similar to the ruling on loans because every loan that leads to a benefit is unlawful.

Based on the aforementioned, it is obvious that the relation between the Islamic Bank and the investors in light of these awards isn`t contractual, rather, it is an individual initiative undertaken by the free will of the Bank`s Administration. And Allah Knows Best.

Iftaa` Board
Chairman of the Iftaa` Board, Chief Justice, Izz Al-Deen Al-Tamimi
            Dr. Mohammad Abu Yahia
           Dr. Abdulsalam Al-Abbadi
    Dr. Yousef Gheezaan
Dr. Wasif Al-Bakhri
   Sheikh Saeid Hijjawi
        Sheikh Na`eim Mojahid

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Summarized Fatawaa

What is the ruling on a person in a state of major impurity (junub) or a menstruating woman (ha'id) reciting the Quran from memory?

It is not permissible for a menstruating woman, a postpartum woman, or a person in a state of major impurity to recite anything from the Quran, whether from memory, from the Quran, from a phone, or a computer. It is also not permissible for them to touch the Quran, based on what was reported from Ali bin Abi Talib that the Prophet (peace be upon him) was not prevented from anything regarding the Quran except major impurity (janabah). (Reported by al-Tirmidhi who said it is a hasan sahih hadith). Menstruation and postpartum bleeding are analogous to major impurity (janabah) as they are all major impurities (hadath akbar).
For those mentioned, it is permissible to mention Allah and supplicate even with verses from the Quran, provided they do not intend them as recitation of the Quran, but intend them as remembrance (dhikr) or supplication (du'a). And Allah the Almighty knows best.

What is the ruling on fasting only on Friday, Saturday, or Sunday?

In voluntary fasting (nafl), it is disliked (makruh) to fast only on Friday, Saturday, or Sunday.
However:
● If one fasts a day before or after Friday, then that is permissible.
● The same applies to Saturday and Sunday—fasting them along with another day removes the dislike.
● Fasting all three days (Friday, Saturday, and Sunday) together is not disliked.
If any of these days coincide with a recommended fasting day, such as Arafah or Ashura, then fasting it alone is not disliked.

What is the ruling on someone who fainted while fasting?

● If a person had the intention to fast from the night but then fainted during the day and regained consciousness before sunset, even for a moment, their fast remains valid.
● However, if they remain unconscious for the entire day, from Fajr until sunset, their fast does not count, and they must make up for that day later.

What is the ruling of Islamic Law on obtaining financing from Islamic banks by bringing invoices in prior arrangement with the seller, then taking the cash after the financing is approved — with the purpose of settling debts and buying a car?

All praise is due to Allah, and peace and blessings be upon our master, the Messenger of Allah ﷺ.
It appears from the transaction described that its underlying purpose is to obtain cash through resorting to a legal artifice (ḥīlah/tawarruq-style trick), and it is not permissible to engage in such trickery or to coordinate with the various parties merely to obtain liquidity. This is because such artifices bring the sale closer in reality to a ribā-based (usurious) transaction, even if it outwardly appears otherwise.
The Prophet ﷺ said: "Do not commit what the Jews committed, thereby making lawful what Allah has made unlawful through the flimsiest of tricks." This was related by Ibn Baṭṭah in his book Ibṭāl al-Ḥiyal (p. 47), and many scholars have graded it as ḥasan (sound/acceptable).
We have already explained the impermissibility of engaging in such deceptive dealings with Islamic banks in Fatwa No. 516, so please refer to it. And Allah, the Exalted, knows best.

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