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Is it permissible in invest?

Last updated: 10th July 2006
Question ID: #2090
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Bismillahir Rahmanir Rahim,
As salaam aliakum wa rahamtullahi wa barakatuh,

I would to know is it is permissble to open and share account? The share account is an investment in a credit uniion where you collect dividends on one share of ownership in the credit union.




Bismillah



Al-jawab billahi at-taufeeq (the answer with Allah's guidance)





Credit union: A non-profit financial institution that is owned and operated entirely by its members. Credit unions provide financial services for their members, including savings and lending. (Investorwords)



How does it work? 1. Members save in a common fund 2. This fund provides low-interest loans to members 3. The interest generated from these loans is used to cover administrative costs 4. Any surplus is returned to members as a dividend.



Investing in a credit union will not be permissible. The reason is that it is based on interest dealings.



Alternatively, one may invest in credit unions based on Islamic principles, prior seeking consultation from their local scholar.





And Only Allah Ta'ala Knows Best.
Mufti
Answer last updated on:
3rd November 2012
Answered by:
Ulamaa ID 04
Website
Location: London
Mufti Qamruzzaman

London, UK