بِسْمِ اللهِ الرَّحْمنِ الرَّحِيْم

اَلْحَمْدُ لِلّهِ رَبِّ الْعَالَمِيْن،وَالصَّلاۃ وَالسَّلامُ عَلَی النَّبِیِّ الْکَرِيم وَعَلیٰ آله وَاَصْحَابه اَجْمَعِيْن۔

Riba, Mutual Funds and Life Insurance

During the past few days I got the opportunity to go through the views of different people in relation to Riba, Mutual Funds and Life Insurance. These views were shared on an internet group. I do not have even the slightest of intention to get into an argument. It is only with the intention of reform that I am writing an article on this topic. May Allah help us all live this perishable worldly life alongside being fully remindful of the eternal life of Hereafter, help us earn our livelihood only through permissible means, and may Allah be pleased and happy with us when our soul departs from our body. Aameen, Thumma Aameen.

In order to form the basis for a healthy and informed understanding of the actual issue, I find it suitable to throw light on two important issues before looking at the actual theme of this article.

Standing or status of wealth in the light of the Holy Quran and sayings of Prophet Muhammad (PBUH);

Wealth is one of the bounties bestowed upon us by Allah. However, for wealth to be a bounty for us in true sense of the term it is necessary that it is earned through adoption of permissible means and, once earned, Allah’s commandments in relation to wealth – Obligatory Charity etc. – are suitably attended to. Alongside being a bounty from Allah wealth is also a human need. However, notwithstanding the fact that wealth is a bounty and a human need, on numerous occasions, the Creator of the universe and leader of all the prophets, Prophet Muhammad (PBUH) have referred to wealth as a temptation, a deceptive or misleading thing, and nothing more than some kind of embellishment of this world. Few examples in this regard are as follows:

  • Wealth and children are the embellishment of the worldly life (Surah Al-Kahf, verse number 46).
  • You are distracted by mutual competition in amassing (worldly benefits), until you reach the graves (Surah Al-Takaathur, verse numbers 1-2).
  • Know well that the worldly life is but a playful thing and an amusement, and a show of beauty, and exchange of boastful claims between you, and a competition of increase in riches and children (Surah Al-Hadeed, verse number 20).
  • Prophet Muhammad (PBUH) said, “Each nation has had its temptation. For my Ummah the temptation is wealth.” (Tirmidhi).
  • Prophet Muhammad (PBUH) said, “When I saw the paradise I found more poor people as its inhabitants.” (Bukhari and Muslim).
  • Prophet Muhammad (PBUH) said, “Poor people will enter the paradise five hundred years before the rich people.” (Tirmidhi).
  • Prophet Muhammad (PBUH) said, “I swear by Allah, I do not fear for you for poverty but I fear that just like the previous nations worldly bounties, as in wealth and property, are opened up before you and then you indulge in its pursuit, and then that wealth and property, just the way it happened with people of previous nations destroy you.” (Bukhari and Muslim).
    • O you who believe, fear Allah and give up what still remains of riba (interest), if you are believers. But if you do not (give it up), then listen to the declaration of war from Allah and His Messenger (Surah Al-Baqarah, verse numbers 278-279).
    • Prophet Muhammad (PBUH) said, “To consume a dinar of interest is worse than committing adultery 36 times” (Musnad Ahmad)
    • Prophet Muhammad (PBUH) said, “There are more than seventy divisions of interest and the lowest one is similar to committing adultery with your mother (Muatta Imam Maalik, Tabraani).

In the light of the Holy Quran and sayings of Prophet Muhammad (PBUH), interest is the biggest sin after polytheism:

 

To those who get associated with dealings of interest in any possible manner, Allah and His Prophet (PBUH) have declared a war against them, and such a severe warning is not to be found with reference to other major sins such as adultery, drinking of alcohol etc. Abdullah bin Abbas (RA) says that he who does not agree on quitting his association with interest based dealings, it is the responsibility of the erstwhile caliph to make him repent. In case the person does not follow the injunction then the caliph should get him executed (Tafseer ibne Katheer).

Having shared these two introductory sections let me now come to the actual theme of this article. First of all we should go through that statement of Allah’s dearest Prophet (PBUH) that, in the larger context of permissible (Halaal), forbidden (Haraam) and suspected things, outlines the Islamic legal principle of avoiding things that are suspected:

 

Naumaan bin Basheer (RA) narrates that he heard Prophet Muhammad (PBUH) saying, “Halaal is clear, Haraam is clear. Between these two there are a lot of things many people don’t know. He, who saved himself from things that are suspected, protected his religion and honour. And he, who gets into things that are suspected (does not stay away from them), will (in due course) fall into things that are forbidden just like the shepherd who takes his goats for grazing near the thorns and increases the likelihood of his getting caught in those thorns” (Bukhari and Muslim).

In the light of this saying of Prophet Muhammad (PBUH) we get to know that in terms of their essence, things are divided into three types:

  1. Those that are clearly Halaal. For instance, wearing permissible clothes, eating permissible food etc.
  2. Those that are clearly Haraam. For instance, interest, drinking of alcohol, adultery, telling a lie, gobbling up orphan’s wealth etc.
  3. Those that cast suspicion vis-a-vis their status as Halaal or Haraam. For instance, the issues under discussion (Mutual Funds and Life Insurance). Majority of the Ulama associated with all the existing schools of thought of the Muslim Ummah agree that these forms of savings are impermissible and forbidden. Some Ulama have considered some of the forms of these investments or savings permissible provided certain conditions are met. Therefore, he who has true love for Prophet Muhammad’s (PBUH) sayings and commands, something that each Muslim should have, as Prophet Muhammad (PBUH) said, “No one can be a complete believer till I become dearer to him than his children, his parents and the rest of the humanity” (Bukhari and Muslim), will never go near these suspected affairs, because Prophet Muhammad (PBUH) has categorically mentioned that he who saved himself from things that are suspected protected his religion and honour and he who gets into things that are suspected (does not stay away from them) is like someone falling into things that are forbidden.

My dear friends! By not investing money in these saving schemes in case we meet apparent and temporary losses, Allah will provide sustenance to us through other better and permissible means as Allah mentions in the Holy Quran, “Whoever fears Allah, He brings forth a way out for him, and provides him (with what he needs) from where he does not even imagine. And whoever places his trust in Allah, He is sufficient for him” (Surah Al-Talaaq, verse numbers 2-3).

A word of caution:

  • Our respected Ulama have permitted to invest money in shares provided few conditions are met. Among those conditions it has also been mentioned that the investor should gather sufficient information about the company whose shares he plans to buy. In case the company is into alcohol business or if the company’s overall business is based on interest then buying shares of such a company is not permissible.
  • These days few worldly physical powers present various financial projects in the name of Islamic banking so that, seeing the name of Islam, Muslims hand over their money to them. Before we invest in any of these projects, it is our responsibility to gather detailed information about these projects, and then, remaining under the guidance of our respected Ulama and keeping in mind the Hereafter, we should take any decision.
  • Few people say that it is extremely impossible to stay away from the system of interest in the times we live in. Because of a range of reasons, to some extent, one way or the other one gets associated with the system of interest. My request to all such individuals is that while we live in this world, we have to prepare for the eternal life of Hereafter, death is absolutely certain, however no one knows the hour of death, that when exactly the angel of death will appear before us to take away our life, and once our eyes are closed we will not get another opportunity to prepare for the Hereafter. Therefore, bear the apparent worldly losses and damages because this worldly life will pass after all but failure in Hereafter will lead to losses that cannot be compensated for. My dear friends! After we are dead, our children and wealth will be of use to us only if we had spent wealth on our children earned through adoption of permissible means.
  • Those who have saved their money in banks and are getting interest on their savings, in that respect the Ulama say that the interest amount be taken out of bank (withdrawn from the account) and spent in charity. It should not be spent on oneself or his children.
  • In case few people are satisfied with mutual funds and insurance (investing money in these plans), my request to them is that at least they should not confuse others by sending them emails because Islam has neither imposed on us the responsibility of thinking about how to increase other people’s wealth nor is there any encouragement in that regard. Rather, there are numerous references to be found in the Holy Quran and sayings of Prophet Muhammad (PBUH) where wealth is termed as a temptation, a deceptive or misleading thing, and nothing more than some kind of embellishment of this world.

May Allah provide us with sustenance that is Halaal and has His blessings, and may Allah help us become one of those who prepare for death before its arrival. Aameen.

Muhammad Najeeb Qasmi (www.najeebqasmi.com)