Answered by: Mufti Mohammed Tosir Miah
Is it permissible to have savings account under Islamic Finance scheme?
بِسْمِ اللهِ الرَّحْمنِ الرَّحِيْم
In the name of Allah, the Most Gracious, the Most Merciful
Ideally, one should protect his money in a safe place and try not to open an account with a bank which entails the taking and giving of interest.
In the Holy Quran Allah (SWA) has said:
“Allah has permitted transactions and has forbidden riba” (Surah Al Baqarah v.275)
The Prophet of Allah (Sallallahu Alahi Wasalam) has cursed the person who takes interest, who gives interest and who writes it and who witnesses it.” (Mishkaatul-Masabeeh p.244 v.1)
“To take dirham of interest knowingly is worse than committing adultery 36 times.” (Mishkaatul-Masabeeh p.246 v.1)
However, if out of necessity, one has to open up a bank account, then one should open an interest-free account. If that is not possible and one opens an interest-based account then one should dispose of the interest money by giving it to the poor without the intention of reward. (Raddul Muhtar p.553 v.9 & Fatawa Mahmoodiyah p.200 v.4)
Regarding your question, if no interest is being added on to your account under an Islamic Finance Scheme but rather the amount which is being added is the profit i.e. Murabaha then it will be permissible to open such a savings account.
Only Allah Knows Best
Written by Mufti Mohammed Tosir Miah
Darul Ifta Birmingham