Question on Banks, Interest, and Khums
Question: What is your fatwa about depositing money in a National Savings Organizations owned by the Government of Pakistan and about receiving interest?
Also, if receiving interest if allowed, Should I pay khums at the time I receive interest from the Bank, or should I calculate the khums at the end of the year based on my fixed date on any amount saved?
Be it known that the Pakistani government is calling itself today an Islamic government. That is to say it considers Islam as a system of life. Although it is not obedient to the commandments of Islam, the condition of this government is like a Muslim who calls himself a Muslim, but does not follow the commandments of Islam; therefore you cannot take or give interest to governmental banks. Money which has come in your hand in the form of interest, should be handed over to a Hakim e Shariah.
Therefore, in order to make profits legal (Halaal) you should deal with Pakistani governmental banks as follows:
That interest rate which is known to you, for example:
In 1 year on 1000 rupees you will be given 100 rupees as interest. So verbally at the bank you should deal with them, that you are selling 1000 rupees in exchange of 1100 rupees and this 1100 you will take after 1 year, and in this manner you should deal at the bank verbally, and whatever they write or type in the register or computer does not concern you and you are not responsible for that.
In this manner if you want to take money from the bank then you should say to the cashier on the counter that I am buying 1000 rupees in exchange for 1100 rupees and this money (1100) will be paid in the decided period.
In both of these conditions it is permitted to give and to take interest, and Khums should be paid at the time of calculating it at the end of the year, and that is only on the money which is remaining from your expenditures.
Allah Knows Better
The Office of
The Grand Ayatollah Al Uzma Sheikh Basheer Hussain Najafi
Najaf e Ashraf