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Friday, November 30, 2012

Ruling on investing money in return for a share of the profit

I have some money that Igave to an investment company to invest, and
it made some profit, but there was no agreementon a set percentage. Is
this riba or not?.
Praise be to Allaah.
If you agreed on that, there is nothing wrong with it. If the company
invested the money in return for half of the profit, or one-third, or
one-quarter, there is nothing wrong with it. But if they give you a
setamount (based on your capital), three or four or five per cent,
this is not permissible. But if you have a share of the profit in
return for giving them the money to use in buying and selling, or
other kinds of business, and you have half of the profit, or
one-quarter or one-fifth,that is fine. This is called mudaarabah.
But if they take the money from you and give you a set amount, such as
five percent, or one percent, this is riba and is not permissible. End
quote.
Shaykh 'Abd al-'Azeez ibn Baaz (may Allah havemercy on him)

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Published by :->
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