Re: Working in a bank
I had the same questions about interest a few days ago, but more related to interest. Someone asked this question to an Aalim on some tv show, and he answered working in banks is haram. I did quit looking at jobs in banks because of that, and now I can't find a job. Good luck sista.
Re: Working in a bank
Islamic banks invest in money market under shariah compliant modes like musahraka and mudaraba. This is how they are expected to earn halal profits. This is different form conventional who LEND/BORROW money- the mode for conventional is Qardh.
I open a roohafza shop in a wine market to cater muslims of the area. I make a statement that i will earn same margin as what wine sellers earn on a wine bottle. Does that make my rooh afza sale haram. No it does not. 
KIBOR/LIBOR is just benchmark of interest and not interest itself.
This is a good short book on the subject
http://www.meezanbank.com/docs/bankari.pdf
Shortest and most comprehensive defination of RIBA
It is reported by Sayyidna Ali, Radi-Allahu anhu, that the Holy Prophet, Sall-Allahu alayhi wa sallam, has said,
“Every loan that derives a benefit (to the creditor) is riba.”
This hadith is reported by Harith ibn Abi Usamah in his Musnad
A detailed account of two types of riba - riba alfadl and riba an nasiyah can be read here The Text of the Historic Judgment on Interest.
I have tried to be brief and to the point, if any thing is not clear or remained unanswered , just point that out inshallah i will try to answer.
Restored attachments:
Re: Working in a bank
Islamic banks invest in money market under shariah compliant modes like musahraka and mudaraba. This is how they are expected to earn halal profits. This is different form conventional who LEND/BORROW money- the mode for conventional is Qardh.....
I've no personal knowledge but my comment was based on what a once close friend told me and he that time was working for an Islamic bank. and said that there is no real difference between an islamic and conventional bank in how they invest in the money market. you might have more knowledge on that its not my domain : )
Re: Working in a bank
Working in loans is 100% haram
Working in recovery and collection dept is 100% haram
Working in mortgages is 100% haram
The concept in Islamic banking is that it becomes a partner in the venture with loan applicant. So, any profit / loss incurred is shared....unlike conventional banks who chase their clients and suck them out like vultures....i've even heard of people peeing and having heart failures while visiting collection departments of banks in Pakistan. My friend working there told me of stories.
In the past 5 years, this matter was also taken up in courts....that banks hire badmash people and threaten borrowers by visiting their premises.....pure Ghunda gardi!
Re: Working in a bank
Ok 
If interested this basic information may help you have some understanding
How conventional bank work
Conventional Banks borrow money(qardh-Principal protected) from depositors > Conventional Banks > Lend(Qardh-Banks principal amount is protected) this amount to business>Business pay interest(See hadith every loan that gives benefit is RIBA) to banks and banks pay interest to depositors.
**How Islamic Banks work
**Islamic Banks take money under mudaraba / musharaka(paticipatory mode- 
took money of hadrat khadija:razi: on mudaraba and there are ahadith about benefits of musharaka) from depositors > Islamic Banks > Invest(Mudaraba/Musharaka) - Sale(murabaha/musawamah/salam-rental(ijarah-Istisna) using this amount to a business>Business pay profit(sale profit/rental income/musharaka mudaraba profit/ etc) to banks and banks pay profit to depositors on the basis of weightages/profit sharing ratio.
Re: Working in a bank
Before any of us talks about anything it is of vital importance to look at things in context of islam v kufar to begin with. Please note that one either lives by islamic system or unislamic system. Even when prophets came they too lived by system that was in place till they were given the mission to change the system and once they succeeded they put in place the divine system.
This is why muslims today are duty bound to fight for bringing about islamic system and once it is in place then live by it. You cannot live by islamic system when it is not in place, if you tried as individuals to do that then you will be destroying yourselves or at least strangling yourselves slowly to death.
Get used to connecting the dots because stupidity can only put ignorant people in hot waters.
It is therefore of utmost importance that muslims do not waste time in trying to please Allah by empty ritualism when the quran guides us to do what needs to be done first and foremost. We are suffering in every way as a nation because we are confused about islam. We think islam is just few things we do on daily basis that have no impact on reality. Islam is a system of life and you cannot live by islam unless you accept it and do all in your power to put it in place.
Learn islam as an ideology for social, political, cultural and economic set up with systems, structures, procedures and practices, why? Because without an ideological framework you have nothing to go on. As we need a good plan for building a good building so we must have good plan before us about setting up islamic way of life. That is exactly what the quran is ie a blueprint for islamic way of life. Ignoring the quran and thinking we can live by islam is only deluding ourselves. Of course we are good at that because centuries of neglect is witness to that. We better stop looking at islam as a religion and do as we please. This never worked in the past in our favour and will never work in our favour in the future.
If the muslim society remains based upon oppression, suppression, injustice, unfairness, cruelty and animosity, stagnation and regression and poverty, how tinkering around te edges is going to solve our problems? Why the quran tells us to enter islam fully?
The real issue is understanding the terminology the quran uses and the connection between the terminologies used in the quran.
Let me try and explain by raising a question, what is connection between ideology, society, politics, culture and economics? It is social ideology that gives us society to begin with ie animals do not have defined relationships do they? It is humans who have sense of mother, father, brother, sister, son, daughter, teacher, pupil. We need to understand relationship concepts because we are interdependent therefore we must have responsibilities towards each other and have rights over each other. If we do not accept this then we are no better than animals.
This is why only if we accept relationships with each other that we are a society not otherwise. The implication of accepting relationships is that we must try to help each other fulfil our needs and wants to the best of our abilities. This brings in concept of political set up hence the need for political systems, structures, procedures and practices so that e could manage our human society and its needs and wants. The implication of political set up is that we must create or bring about a culture in our society that is helpful in fulfilling our needs and wants. Since our needs and wants are physical and are related to livelihood therefore we must have a economic system that helps us as a society to fulfil our needs and wants in a way that helps us living a worthwhile life. This is why we need to put in place economic systems, structures, procedures and practices so that our society is fully running order and smoothly.
This is all told in the quran but because we are not used to reading the quran the way it was supposed to be read so we are just fighting over things that actually side track us.
Most of us think the quran should be left out of the way because it is just an old book for pooja paat. In my study of the quran I found the quran far far ahead of what we know today. The way so called muslim learned people talk about the quran means we are nowhere near understanding the quran properly. This is going to take much more time for us to realise.
It should now be very clear that talking about bits and pieces in the quran in isolation from each other is not the right way to understand the issues that face us. We need to know the proper context in which things the quran talks about make sense.
For example, RIBAA is not an issue on its own in the quranic text rather it is part of the quranic context. The quran uses a lot of words that need to be connected to each other in such a way that they make visible to us the system as a whole. ribaa is part of slaah, zakaah, anfaal, ghaneemah, maash, baee, tijaarah and so on and so forth. The whole thing is connected to land and resources, means of production and distribution. This is why islam is about proper management of people and resources.
The question arises, was the quran misinterpreted through ignorance or was there a deliberate conspiracy by some people against the worldwide masses? It seems a bit of both is at work and so long as we do not bother to know the quran in its proper context the masses around the world will remain in the state of existence that they are in. It suits the rich and the power that way and people who are ignoring message of the quran are only helping them to use and abuse humanity.
From all this explanation, it should be clear to those with knowledge how certain parts in islamic ideology are interconnected to each other for complementing each other and also what our real problems are and why. It is for this reason we must realise that we cannot afford conflict between these parts or the whole thing falls apart. As we do not have any islamic state currently, our foundational responsibility is to organise worldwide as a single community and deal with each other within islamic context and deal with others outside as they want us to deal with them till we have a proper islamic state in place. Our main concern should not be living as we are forced to live by harmful forces but to try our best to resist the pressure through our unity and hard work and then try to turn the tide. If we are not taking islam that way then we are not really interested in islam just paying lip service to islam and each other and doing as we individually like.
Islam is neither for people who wish to remain stupid like animals nor for those not interested in peaceful existence. This is why we need to spread the proper message properly to get people together who like the idea of peaceful and prosperous existence. This requires a lot of sacrifice in form of hard work not empty words. Changing the world for the better is not an easy task if we read stories of the prophets and their struggles.
Re: Working in a bank
^ read this all. Can you relate this to the discussion in hand in one line.
Re: Working in a bank
@ Mughal1
Islam clearly differentiates between halal and haram. there is no in-between.
Seems you are trying to sail on two boats at one time…
Re: Working in a bank
So the margins are built in already in the mechanism, isn't that unislamic??
I have seen how murabaha transactions are structured. Just exchanging invoices, valued at predetermined kibor based markup doesn't make transactions islamic.
Re: Working in a bank
How come agreeing on price mechanism is unislamic, it is there to remove gharar(uncertainity)
if any murabaha transaction only involves exchange of invoice without any actual asset acking then it is haram and banks normaly do send such earned profit to chairty. (you may see meezanbanks annual report/shariah advisor report ).
How do you make sales? profit is predertmined or not. infact in sale transactions like murabaha , if profit is not predetermined then the transaction is haram. :)
Do not confuse sale transaction with participatory modes of islamic economics like musharaka and mudaraba where this is not possible.
Re: Working in a bank
penalty=charity=service charges :)
I am not talking about meezan bank though, i do believe they are the ones who are better than the rest.
I am not one of those who discourage islamic finance altogether..but there is a lot of gimmickry involved.
Re: Working in a bank
penalty=charity=service charges :)
I am not talking about meezan bank though, i do believe they are the ones who are better than the rest.
Structure is same in all islamic banks brother.
penalty which is a problem in pakistani market is not included in profit distribution or bank income, it just goes out of the window without any marketing by the bank. I know that as i have worked in shariah advisory and supervision. :)
Re: Working in a bank
I am sorry, but Musharakas and Mudarabas (in Pakistan at least) mostly invest in stocks of companies and not real business ventures. These companies are also financed by traditional banking channels. I am not sure if profits from such investments would still remain purely shariah compliant. Islamic financing remains a theory.
In terms of substance of transactions for consumers, there is no difference between traditional banking and so called Islamic banking as has been implemented in Pakistan e.g. in both leasing and ijarah, rights and liabilities of parties are more or less the same.
About definition of Riba, the Hadith you quoted is not accepted unanimously and considered weak in many traditions. Even the judgement you cited says the same. Also see page 7 of http://www.bilalassoc.com/upload/other/riba-hadithr.pdf .
Re: Working in a bank
When i say musharaka and Mudaraba , it means under musharaka and mudaraba mode and not mudaraba/musharaka companies.
Bank place funds in say overnight placement under mudaraba mode , become short term depositor for another islamic financial institution. ala haza al qayas 
Leasing and ijarah are different, risk of ownership is different , in ijarah if the asset is destroyed then the bank bears the loss.
I just quoted the shortest defination, link i provided had more indepth discussion on the issue. There are 2 types of RIBA, and hence 2 different criteria for them. difference of opinion among scholar is never to justify commercial interest or any sort of current mark ups. reading the link you provided. Inshallah will give feedback soon.
Re: Working in a bank
For example, RIBAA is not an issue on its own in the quranic text rather it is part of the quranic context. The quran uses a lot of words that need to be connected to each other in such a way that they make visible to us the system as a whole. ribaa is part of slaah, zakaah, anfaal, ghaneemah, maash, baee, tijaarah and so on and so forth. The whole thing is connected to land and resources, means of production and distribution. This is why islam is about proper management of people and resources.
The question arises, was the quran misinterpreted through ignorance or was there a deliberate conspiracy by some people against the worldwide masses? It seems a bit of both is at work and so long as we do not bother to know the quran in its proper context the masses around the world will remain in the state of existence that they are in. It suits the rich and the power that way and people who are ignoring message of the quran are only helping them to use and abuse humanity.
Peace Mughal1,
Will u mind to explain the above with correct interpretation from the verse(s) of Holy Qur'an? and plz! don't post long phrase. Post it as we asked (as per discussion) otherwise believe me i won't gonna hesitate by taking an action against ur post.
Re: Working in a bank
Peace Mughal1,
Will u mind to explain the above with correct interpretation from the verse(s) of Holy Qur'an? and plz! don't post long phrase. Post it as we asked (as per discussion) otherwise believe me i won't gonna hesitate by taking an action against ur post.
Dear lethal kamikaze, let say you have a jigsaw puzzle of your own and I have mine. They are both made of same pieces of cardboard but pieces of your jigsaw puzzle are cut differently in shape and size than mine so the fitting is not the same. The pieces of my jig saw puzzle only fit with each other but when you show me pieces of your jig saw puzzle I see that some of them do not fit together. Not only that but when you take some pieces from my jig saw puzzle and try to fit them with your pieces that makes things even worse.
Likewise when I interpret a verse it is according to the context I have in my head so you cannot fit it with the context you have in your head that you have taken from interpretations of others.
In the quranic context, trade does not mean business for profit rather it is trade for the benefit of mankind ie for fulfilling the needs of people. So word TIJAARAH should not be taken in sense of profiteering from business. It is because to begin with we are not to profit from each other at the expense of social relationships therefore deception and greed etc does not come into it.
In the quranic context BAEE=agreement or contract and that is bound by islamic constitution ie the quran. So trading of goods and services is bound by constitution and constitutional laws. So baee is has nothing to do with trading for profit either.
In the quranic context RIBAA does not mean interest on lent or borrowed money but profiteering at the expense of community life. It is because in islam people are bound by brotherhood so it is inconceivable that brothers in the name of God would profit from each other instead of giving their all for each other. It is matter of if I have something but I am not using it and you need to use it then you just take it and use it and when you are finished using it and someone else needs it then let him have it sort of life style.
Money is simply used for tokenism to facilitate trading or movement of goods, it in itself has no value, be it in coins of gold and silver or just notes on paper. ANFAAL is reserve or extra production by the community not war booty. The brotherhood is supposed to work hard together and maximise production and then collect and divide it into parts for various uses eg normal daily use part, emergency part, reinvestment part, part to take care of things when there comes about a change eg new people coming from outside to join muslim community etc or new born babies. research and exploration needs etc etc. GHANEEMAH= production by community not maale ghaneemat dile berahem. Likewise all words have certain function in an organised community.
People cannot understand these concepts till they realise how to organise and run a community or a country and what will be needed for the process to be successful.
It is because islam binds people into a strong brotherhood that has to be alive and should mean something that is why people who realise the goodness in that way of life happily give their life for it because they will not be worries about whom they leave behind because they know they will b ewell looked after by each other.
In today's muslim societies a woman cannot even step outside her home yet we claim we are muslims. That is just lip service to islam. Real muslim society could only be that wherein there is no KHOWF nor HUZN because all ensure security and prosperity of each other. This is why that is true brotherhood and woman and men all feel secure and at peace with each other.
You can see why I need to explain things in detail rather than just throwing around one liners. The real concepts of islam are dead in minds of people, they only exist in books. We have plenty of hufaaz of the quran and hadith and fiqh but not ulemaa of these sources who really understand what is in their minds.
regards and all the best.
Re: Working in a bank
Peace Mughal1,
The purpose of this forum is that we learn from each others. I agree pplz have different of opinion but it is very easy to know something just on single click rather than visiting a qualified person and ask him. Pplz here usually share their personal experience too which help us understand better. But long post usually distract the readers something causing not posting anymore in a thread.
I agree what u wrote above but pplz who post/read here are different some like to read long pharase but some others not. Therefore I request you to post to the point and in short. However, if a member ask you to post in details than u r free to do so.
Re: Working in a bank
Dear lethal kamikaze, let say you have a jigsaw puzzle of your own and I have mine. They are both made of same pieces of cardboard but pieces of your jigsaw puzzle are cut differently in shape and size than mine so the fitting is not the same. The pieces of my jig saw puzzle only fit with each other but when you show me pieces of your jig saw puzzle I see that some of them do not fit together. Not only that but when you take some pieces from my jig saw puzzle and try to fit them with your pieces that makes things even worse.
Likewise when I interpret a verse it is according to the context I have in my head so you cannot fit it with the context you have in your head that you have taken from interpretations of others.
In the quranic context, trade does not mean business for profit rather it is trade for the benefit of mankind ie for fulfilling the needs of people. So word TIJAARAH should not be taken in sense of profiteering from business. It is because to begin with we are not to profit from each other at the expense of social relationships therefore deception and greed etc does not come into it.
In the quranic context BAEE=agreement or contract and that is bound by islamic constitution ie the quran. So trading of goods and services is bound by constitution and constitutional laws. So baee is has nothing to do with trading for profit either.
In the quranic context RIBAA does not mean interest on lent or borrowed money but profiteering at the expense of community life. It is because in islam people are bound by brotherhood so it is inconceivable that brothers in the name of God would profit from each other instead of giving their all for each other. It is matter of if I have something but I am not using it and you need to use it then you just take it and use it and when you are finished using it and someone else needs it then let him have it sort of life style.
Money is simply used for tokenism to facilitate trading or movement of goods, it in itself has no value, be it in coins of gold and silver or just notes on paper. ANFAAL is reserve or extra production by the community not war booty. The brotherhood is supposed to work hard together and maximise production and then collect and divide it into parts for various uses eg normal daily use part, emergency part, reinvestment part, part to take care of things when there comes about a change eg new people coming from outside to join muslim community etc or new born babies. research and exploration needs etc etc. GHANEEMAH= production by community not maale ghaneemat dile berahem. Likewise all words have certain function in an organised community.
People cannot understand these concepts till they realise how to organise and run a community or a country and what will be needed for the process to be successful.
It is because islam binds people into a strong brotherhood that has to be alive and should mean something that is why people who realise the goodness in that way of life happily give their life for it because they will not be worries about whom they leave behind because they know they will b ewell looked after by each other.
In today's muslim societies a woman cannot even step outside her home yet we claim we are muslims. That is just lip service to islam. Real muslim society could only be that wherein there is no KHOWF nor HUZN because all ensure security and prosperity of each other. This is why that is true brotherhood and woman and men all feel secure and at peace with each other.
You can see why I need to explain things in detail rather than just throwing around one liners. The real concepts of islam are dead in minds of people, they only exist in books. We have plenty of hufaaz of the quran and hadith and fiqh but not ulemaa of these sources who really understand what is in their minds.
regards and all the best.
Money has been minted since early Islamic age for trading purpose. Profiteering is Halal. There is a system to give poor in the form of Zakat and other noble causes. In the history of mankind, Allah has given some people much more wealth than others.
In Islam, it is 2.5% zakat, in Hinduism 10% is to be spent on noble causes from ones earnings (just to give you an example). Many hospitals from the pre-partition era are named after Hindu's. Like Sir Ganga Ram Hospital in Lahore, etc.
You are living in fantasy world.
