Muslims' requirement for "interest-free" bank account Vs. social security benefits ???

Question

After listening to Abu Izzadeen's recent interview on BBC Radio 4, it reminded me of my days while working at a bank's call centre.

Our bank had 2 different current account one called "Current Account Plus" and other called "Current Account". The difference being Current Account Plus offered 0.1% while Current Account offered NO interest whatsoever, which was specially designed we're told for tax purposes along with any individual's religious reason.

I never ponder much about the reasons behind it, but listening to Abu Izzadeen's views on British society on BBC Radio 4, I wonder how exactly do Muslims justify the requirement of "Current Account" since their faith DOES NOT allow them to have "interest" on their money, as it's seen as "haram". If such is the case, then how exacly do they justify claiming/getting social security benefits, such as job-seekers allowance, tax credit, disability benefit, etc.

http://www.bbc.co.uk/radio4/today/listenagain/ram/today4_abu_20060922.ra

When speaking to Muslim customers, when I used to recommend them to "upgrade" their account from Current Account to Current Account Plus, so as to get at least some interest on their money, I used to get told that because of their faith, they're not allowed to have interest on their money, since it's seen as "haram".

Speaking of "interest" as "haram", how about paying interest on the Mortgage or Loan itself. Is that often frowned about by the believer of this faith, as well ???

How about the lottery win itself ??? Isn't that perceived as "haram" ???

Answer 1

even though am not sure who is Abu Izzadeen and i can listen to him coz the like is not working but i asume that ur question was asked to him.

yes interest is haram in islam and for more details go to this like: http://www.inter-islam.org/Prohibitions/intrst.htm

now let me tell you something that will suprise you, islam was the fist to udopet the social security system in the time of the Khulafa (islamic leaders) becouse islam understand that it is a fundamental human need. Sudden sickness, death, disability, disease, unemployment, fire, flood, storm, drowning, accidents related to transportation, and the financial loss caused by them are the reasons, which create this need. The sufferings from these events take the victim and his dependants towards poverty. The economic situation of the affected people becomes so unsound that they need economic help. This actuality requires that social security should be treated as a basic human need over a very wide range of human activities and situations.

now saying that dose not mean it is halal for everyone to claim it but only for the people who really needs it.

In Islam, right from the beginning, fulfillment of the basic needs of everyone who is unable to meet his/her needs was conceived to be the concern of the State. Zakat is the first institution of social security in Islam. Payment of 2.5 percent of his/her savings for the zakat fund is one of the fundamental duties of a Muslim. The State is responsible to collect zakat and make arrangements for its distribution. Non-payment of it is equivalent to waging war against the State. The Caliph Abu Bakr subjugated by force all those who refused to pay it.

Non-Muslims are also included in one of the categories of the recipients of zakat. While prescribing laws for the distribution of zakat, the Qur'an includes them among those 'whose hearts are to be conciliated'.

The Western concepts of social security systems are the outcome of human mind, but the social security system of Islam is Divine in character and based entirely on the Qur'an and Sunnah. It is a system to accomplish the high standard of morality expressed under the term ‘righteousness’. The Glorious Qur'an states:

“It is not righteousness that ye turn your faces towards East or West; but it is righteousness, to believe in Allah and the Last Day, and the Angels and the Book, and the Messengers; to spend of your substance, or of love for Him, for your kin, for orphans, for the needy, for the wayfarer, for those who ask, and for the ransom of slaves; to be steadfast in prayer, and give Zakah, to fulfil the contracts which ye have made; and to be firm and patient, in pain (or suffering) and adversity, and throughout all periods of panic, such are the people of truth, the God-fearing” (al-Qur'an, 11:177).

for more details: http://www.irfi.org/articles/articles_251_300/social_security_in_islam.htm

Answer 2

To receive interest is haram, but when we pay mortgages and loans, yes we have to pay interest, unfortunately how can we buy a house without a mortgage, so we have no choice but to pay interest, well in the old days we did not have banks that provide for muslims, there are now few banks that have opened and understands our needs, so interest is not charged, how it is worked out i don't know. If we live in a country and house prices are unaffordable we can pay a mortgage, if you have no choice, if you have interest we are not allowed to spend it, we have to give to charity. We are in the month of our fasting, this is when we are charitable. and about the other benefits, if people are claiming benefits unlawfully that is haram too, well that is on their shoulders, I am a single mum, with two kids, i am on Tax credits, but i work and pay my taxes, i don't cheat the system. If people cheat the system then that is haram,forbidden, playing the lottery is too, hey, we are all not perfect.

Answer 3

Interests, Lottery and defrauding government are haram in Islam. (not permissible). Muslim peoples are well aware of Islamic Laws, now why do they do that I don't know. Just like a lot of people who call themselves Christians don't follow the teachings of Christ.

There are some financial institutes in Islamic countries, where you can borrow money without interests. But here in Western countries it's almost impossible. I guess they have no choice but to pay interest on mortgage.

Answer 4

Interest was forbidden as money was lent to the poor with high interest by the rich. I have come to believe at the moment the credit card and bank account charging and interest system is immoral as it’s excessive as many people are burdened by debts and these are the most vulnerable and if they had been a bit more careful or had the money they wouldn’t allow themselves to be charged by the banks like this, and then if they can’t pay up they will have a bad credit rating which has further consequences so the most vulnerable are taken advantage of (rather than being helped).

People can make money other methods without interest but make sure it’s ethical. If your money is sitting in a current account (not savings) you are hardly going to make much money on the ultra low interest offered unless you have millions there.

Trade is allowed in Islam – our prophet was a trader but he lived frugally mending his own clothes and not cooking for days within the household.

“….. they say, "Trade is [just] like interest." But Allah has permitted trade and has forbidden interest.”(Quran: 2:275)

“And whatever you give for interest to increase within the wealth of people will not increase with Allah. But what you give in zakah(charity), desiring the countenance of Allah – those are the multipliers”.(Quran: 30:39)

Gambling is haram too as this might become an addiction, people might lose their money with harsh consequences for them and their families and rely on winning money by chance. (I think Premium Bonds (by National Savings, UK) is better as you will get the opportunity to win a million pounds twice and other amounts every month for every one pound you have in there and you don’t lose your money – you can take it out when you want but no interest is offered in your money)

"They ask you about wine and gambling. Say, "In them is great sin and [yet, some] benefit for people. But their sin is greater than their benefit." And they ask you what they should spend. Say, "The excess [beyond needs]." Thus Allah makes clear to you the verses [of revelation] that you might give thought. "(Quran: 2:219)

"O you who have believed, indeed, intoxicants, gambling, idols, and divining arrows are but defilement from the work of Satan, so avoid it that you may be successful". (Quran: 5:90)

Answer 5

If you are gaining something by selling a product or by giving a service or lending money is a business.

If muslims are not accepting the interest, even they do not expect the profit from their business too. If the interest part is haram even the profit too is haram.

If you have some amount, you invest purchase a product and sells you will get profit. instead you are helping a person doing business, purchasing some assets, by investing the amount you are sharing his profitability. If they are feeling that this is haram it is cheating them selves. If they donot want to do haram we will get a barral of petrolium for 2 to 3 dollers.

Answer 6

1) Interest is haraam.

2) Social security benefits are only allowed to be consumed by Muslims who are genuinely poor.

3) Interest on a mortgage or loan is haram.

4) Participating in lotto is haraam and if you win you are not allowed to consume the money.

Answer 7

Mohammad was too stupid to understand the concept of banking. He hated the Jews way of banking so he changed it to a method that would be more appealing to would-be converts. He uses the same sales tactic as banks do. Today, the popular things with banks is "free checking" but a bank can't afford to do that unless they charge interest. I guess Mohammad thought bankers should work for free. God I hate Islam

Answer 8

hi,
nice question but about social security that falls under the responsibility of the goverment. and in islam it is said that is the duty and not the gain without labour as people form the goverment to make their benefit and promote their interest.

Answer 9

Yeah because it's in the Qu'ran not to charge people for needing money, it's very fair actually, because obviously people need money because they have none.