| II. Fatwas by the Council of Islamic Studies, Al Azhar - Cairo, (Second Conference, Muhurram, 1385 A.H./ May, 1965). |
Concerning bank operations, the conference passed the following decisions: 1. Interest an all kinds of loans is prohibited Riba. There is no difference between loans for consumption or what id described as a productive loan as the texts in the Book and Sunnah are definite in outlawing both kinds. 2. Large or small amounts of Riba are both unlawful as is well understood by Allah's saying: "O believers, devour not usury, doubling its rate many times. Have a fear of Allah, and you shall prosper." 3. Lending for Riba is prohibited; it is not justified by any need or necessity. Usurious borrowing is also prohibited. This sin is forgiven only if committed by necessity. Even person is given the discretion to judge this necessity, according to his belief. 4. Bank operations (current accounts, payment of cheques, letters of credit, bills which are handled internally by merchants and banks) are legal banking operations. Any money taken in return for these operations is not Riba. 5. Fixed term deposits, interest - based credits and all kinds of loans in return for interest are usurious operations. They are forbidden. |