Joining any savings scheme is allowed in Islam or not? You will ofcourse get back an increase form these schemes what some call intrest and some claim it is not.

Mu' meneen Brothers and Sisters,

As Salaam Aleikum wa Rahmatullahi wa Barakatuh. (May Allah's Peace, Mercy and Blessings be upon all of you)


One of our brothers/sisters has asked this question:

Assalamu alaikum,


Pls clear my doubt on intrest. I know its haraam to give and take intrest. But in todays situation, in such a society even if you dont want to give or take intrest you are forced to be a part of it. In the modern way of living an average man takes loans to ful fill his needs, not luxuries, necessities like building a home, for marrying his sisters or daughters, old parents treatment. By taking loan he have to pay intrest. Else there is nobody to help him with such big amounts. The loan conditions will be the person who took loan will repay it in small monthly installments  which will be convenient for him to do. And that repayments are done from his salary, his earnings, his sweat.


This is the case of giving intrest. Now on the other hand now a days we come across a lots of schemes and policies what they claim to give profit on our money deposits. And these scheme says they invest our money in some big business and the increase what we get is the profit on such business. Kindly make clear whether living with such money is haram. If this is haram, then is business also haram? Joining any savings scheme is allowed in Islam or not? You will ofcourse get back an increase form these schemes what some call intrest and some claim it is not. Schemes like you will pay yearly an amount for these many years and after say 10 or 15 years you get back a good money. If you are going to just keep this money in your hand on the same way yearly a particular portion from your salary, forget about the return from schemes, you wont be able to keep it with you. So isnt it better for your childrens future and such things that you join a savings scheme or something as such?


Kindly give a clear answer for my doubts, as I am confused with double opinion from the people around me.


(There may be some grammatical and spelling errors in the above statement. The forum does not change anything from questions, comments and statements received from our readers for circulation in confidentiality.)




Taking and paying interest

In the name of Allah, We praise Him, seek His help and ask for His forgiveness. Whoever Allah guides none can misguide, and whoever He allows to fall astray, none can guide them aright. We bear witness that there is none worthy of worship but Allah Alone, and we bear witness that Muhammad (saws) is His slave-servant and the seal of His Messengers.


Allah says in the Holy Quran Chapter 2 Surah Baqarah verse 274-276:

But those who devour ‘riba’ become like the one whom Shaitaan has bewitched and maddened by his touch.   They have been condemned to this condition because they say,  “Trade is just like ‘riba”,  whereas Allah has made trade halaal and ‘riba’ haraam.   Henceforth,  if one abstains from taking ‘riba’ after receiving this admonition from his Lord,  no legal action shall be taken against him regarding the ‘riba’ he had devoured before:  his case shall ultimately go to Allah.   But if one repeats the same crime even after this,  he shall go to Hell,  where he shall abide for ever!   Allah deprives ‘riba’ of all blessing and develops charity, and Allah does not like an ungrateful, sinful person.


Allah says further in the Holy Quran Chapter 2 Surah Baqarah verse 278:

O Believers!,  fear Allah and give up that ‘riba’ which is still due to you,  if you are true believers.   But if you do not do so,  then you are warned of the declaration of war against you by Allah and His Messenger!


Allah says in the Holy Quran Chapter 4 Surah Nisa verse 161:

That they took ‘riba’,  although they were forbidden.  And that they devoured men’s substance wrongfully.   We have prepared for those among them who reject faith a grievous punishment (of Hell Fire)!


Allah Says in the Holy Quran Chapter 3 Surah Ale-Imraan verses 130-132:

130    O ye who believe! Devour not ‘riba’ doubled and multiplied; but fear Allah; that ye may (really) prosper.

131    Fear the Fire which is prepared for those who reject faith.

132    And obey Allah and the Messenger; that ye may obtain mercy.


Allah Says in the Holy Quran Chapter 30 Surah Rome verse 39:

39      That which ye lay out for ‘riba’ through the property of (other) people will have no increase with Allah: but that which ye lay out for charity seeking the Countenance of Allah (will increase): it is these who will get a recompense multiplied.


Allah Says in the Holy Quran Chapter 2 Surah Baqarah verse 276:

276    Allah will deprive ‘riba’ of all blessings, but He will give increase for deeds of charity: for He loveth not creatures ungrateful and wicked.


Al-Tirmidhi Hadith 2829        Narrated by Ali ibn AbuTalib

Ali said he heard Allah's Messenger (saws) invoke the curse of Allah on those who took ‘riba’, those who paid it, those who recorded it, and those who refused to give sadaqah.


Dear and beloved sister in Islam, every single type, derivation, and manifestation of ‘riba’ (including usury, interest, etc.) is absolutely and categorically forbidden for the believers who sincere believe, trust, fear, and have faith in Allah and the Last Day…..thus let no one convince you otherwise!


Islam does not prohibit one from saving or investing one’s wealth; but if the increase in one’s savings is guaranteed by an institution, one can be almost assured that it involves the abomination of the unlawful ‘riba’….and Allah and His Messenger (saws) have declared absolutely zero-tolerance towards the abomination of ‘riba’.


If one trusts, obeys, and follows the guidance and commands of Allah and His Messenger (saws),   one can be assured of never ever being misled;   but if one believes, obeys and follows any other guidance, other than that of Allah and His Messenger (saws), one can be assured of being led astray.  


Whatever written of Truth and benefit is only due to Allah’s Assistance and Guidance, and whatever of error is of me alone.  Allah Alone Knows Best and He is the Only Source of Strength.


Your brother and well wisher in Islam,





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