Fatwa ID: 04516

Answered by: Maulana Nabil Khan

Question:

When assessing if a financial institution is shari'ah compliant or not, what are some of the key things we look at?

بِسْمِ اللهِ الرَّحْمنِ الرَّحِيْم

In the name of Allah, the Most Gracious, the Most Merciful

Answer:

Contemporary Islamic Finance is a sensitive topic. Shariah has taught us the jurisprudence regarding all aspects of transactions and business and the parameters surrounding the Islamic morals and ethics found within them.

Due to the serious charges that have changed in the world economy by way of banks, credit cards, leasing, loaning, investing, cryptocurrencies, and much, much more that have affected the entire world including Muslim countries it is very important to understand what to look for in terms of halal/shariah-compliant alternatives.

Since these financial issues are facing constant change and are highly affected by regulations and governing bodies in many aspects it is important that one goes to the right individuals in this regard. These issues are amongst the Nawazil (contemporary fiqh issues) and one should follow only the individuals that are recognized scholars and worthy of being trusted in this regard.

Generally speaking, there is a very well known and trustworthy shariah board which is chaired by Mufti Taqi Uthmani and contains leading shariah scholars worldwide. This board is well trusted and the standards applied are both Shariah-compliant as well as practical in both western and eastern societies. This board is the Aaoofi board and should be used as a reference point to act upon the opinion of the mainstream scholars in this field rather than individual opinions.

Reference:

Al-Fatwa Wa Fiqh Al-Nawazil Pg 13

Only Allah knows best

Written by Maulana Nabil Khan

Checked and approved by Mufti Mohammed Tosir Miah

Darul Ifta Birmingham