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Fatwa CenterBuying Shares with Interest in Pakistan
Question
I live in Pakistan and Islamic banking does not exist here. All investments are doubtful. We have a scheme which is called the Defense Saving Certificate Scheme. In this Scheme, a person buys certificates for a period of five or ten years and then the profit is four times more.
For example if one buys shares of 5 lack rupees, after ten years he can sell it back to the government for 20 lack after five years it 10 lack.
One of my sisters does not have a house and I want to help her. I cannot afford to buy her an apartment or a house. Is it possible for me to buy these shares and after a period of five years, I get a double amount, instead of using it for myself as it is Haram, I buy an apartment for her? Since we are living in Islamic country, many people say that it is a government scheme and it is allowed. I do not want this money for fear it is Riba, but want to use it to help her. Can I do that according to Islam?
Answer
All perfect praise be to Allah, The Lord of the Worlds. I testify that there is none worthy of worship except Allah, and that Muhammad 
is His slave and Messenger.
Purchasing saving certificates in return for a certain profit based on the value of the certificates is pure Riba (usury/interest). Actually, this is a usury-based loan and what the person is receiving after five or ten years is nothing but Riba. Such a transaction would not become lawful even if it is the government that operates it.
Know that the extent of necessity that makes Riba permissible is fearing death and the absence of other ways to feed oneself except by use of Riba, or being in a hard and unbearable need and not having any means except dealing with Riba, such as the lack of clothes to cover one's Awrah (compulsory parts of the body that must be covered), or lack of place to dwell in even with rent. In such a critical position one may deal with Riba.
In addition to this, you should know that necessity is valued according to its proper value.
Therefore, you should fear Allah, avoid being in war with Him, and keep away from this evil since purchasing a house for your sister is not a sound reason to deal with Riba.
Allah knows best.
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