Is It Permissible for a Non-Muslim to Use an Islamic Bank?

20 August, 2019

Q Respected scholars, as-salamu `alaykum. Can a non-Muslim use an Islamic Bank? I was informed that non-Muslims are forbidden from using them. Also, what exactly is Islamic banking and what is its basis in Islam? Thank You!

Answer

Wa `alaykum as-salamu wa rahmatullahi wa barakatuh.

In the Name of Allah, Most Gracious, Most Merciful.

All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.

In this fatwa:

There is no doubt that Islamic banks can be used by Muslims and non-Muslims alike without a single thing of differentiation between them.

In his response to your question, Prof. Dr. Monzer Kahf, Professor of Islamic Finance and Economics at Qatar Faculty of Islamic Studies, states:

Islamic banking, as defined by the Wikipedia encyclopedia, refers to a system of banking or banking activity that is consistent with Islamic law (Shari`ah) principles and guided by Islamic economics.

In particular, Islamic law prohibits usury — the collection and payment of interest, commonly called riba in Islamic discourse. In addition, Islamic law prohibits investing in businesses that are considered unlawful, or haram (such as businesses that sell alcohol or pork, or businesses that produce media such as gossip columns or pornography, which are contrary to Islamic values).

Islamic banking has the same purpose as conventional banking except that it operates in accordance with the rules of the Shari`ah, known as fiqh Al-Mua`malat (Arabic for “Islamic rules on transactions.)

There is no doubt that Islamic banks can be used by Muslims and non-Muslims alike without a single thing of differentiation between them. Islamic banks in Malaysia, for instance, have more non-Muslim customers than Muslims.

In brief, Islamic banks are normal banks that observe two main things:

1- Their financing and deposits are done without interest (this does not mean without return) because they do not take funds or give funds on the basis of lending; they rather take and give money on the basis of either sharing, sale, or leasing.

2- They are morally committed in their transactions. For example, they do not accept to finance casinos, liquor, tobacco, and all other vice activities.

Allah Almighty knows best.

Editor’s note: This fatwa is from Ask the Scholar’s archive and was originally published at an earlier date.