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Investment

Answered according to Hanafi Fiqh by Fatwaa.com
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If you invest in a company and that company pays 8 to 12% of the amount invested according to the profit gained by company, is it interest? Please guide.

Answer

Wa’alaykum as Salam wa rahmatullahi wa barakatuhu,

That is too little information to pass a ruling on the investment. In order to advise, please send the entire contract, or full details about the investment. What happens if the profits are less than 8% or more than 15 % of the capital? What happens if there are no profits? What exactly is done with the funds once invested? The ruling will be based on those factors.

And Allaah Ta’aala knows best

Wassalaam,

Ismail Moosa (Mufti)

This answer was collected from Fatwaa.com which is an excellent Q&A site managed by Mufti Ismail Moosa from South Africa. .

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