Taking a loan from a Riba-based bank to start a business
Fatwa No: 145713

Question

Assalamu alaikum! I am a nigerian working with an interest base bank, i tried hard to get another job but all my efforts are in vain,is it permissable to apply for loan from same institution which I can use to start up my business? Allah bless.

Answer

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) is His slave and Messenger.

It is forbidden to work in a bank that deals with Riba (i.e. interest and/or usury) except in case of necessity in a way that you do not find a permissible job to spend on yourself and on whomever you are obliged to spend. However, the necessity is valued according to its proper value and whenever you find another permissible job, it becomes forbidden for you to stay in that bank; for more benefit, please refer to Fataawa 127388 and 142583.

As regards taking a loan from this bank with interest, then this is not permissible as this is making other people consume Riba and it is confirmed in the Hadeeth that “Allaah has cursed the one who consumes Riba (i.e. usury or interest), and the one who gives it to others to consume.” [Muslim]

Finally, the good objectives should not be achieved by forbidden means.

Allaah Knows best.

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