Fatwa ID: 08921
Answered by: Maulana Sakib Shadman
Question:
I received a question about gatehouse bank investment schemes if it’s ok. They have a variable profit rate so the question was there doesn’t seem to be any imkaan of loss which doesn’t sound right.
In the name of Allah, the Most Gracious, the Most Merciful
Answer:
With Mudarabah based Islamic savings accounts, the bank invests the money that you deposit into your savings account, and they pays out an expected profit rate (EPR) as opposed to an interest rate. This is the expected rate of return on their investments and it is a variable rate. If the Islamic bank makes a higher profit than expected, your return will be greater and vice versa.
However some banks build a reserve to stabilize their profits. In other words, if the bank earns more profit than expected, they do not distribute this excess profit to their customers in case they make a loss later on i.e. they keep this excess profit as a safety net and distribute it to the customer if the bank makes a loss later on.
A Shariah compliant savings account will not invest your money in any interest based or Haram financial products. However, even if the bank’s investments are relatively low risk, there is still a small chance that the bank will lose money on the investment. If the bank does not guarantee your principal, you may lose part of your deposit.
As for Gatehouse bank, I do not recognize any of the three scholars in their Shariah compliance board. (See link below)
https://gatehousebank.com/about-us/our-team/shariah-supervisory-board
You will have to check with trustworthy local scholars as to whether the scholars on their Shariah board are reputable. Gatehouse bank does guarantee your principal up to £85000 pounds. They claim they have always paid out their EPR.
You will simply need to check what financial products this bank invests in, as this information is not available online. Do not deposit your money with them until you find out this information. If their investments are Shariah compliant and free of Riba, you may deposit your money into their savings account. You may contact them for more information as to how they invest the money from your savings account.
References:
https://www.raisin.co.uk/banking/expected-profit-rate/
الْمَعْهُودُ بِكَيْلٍ أَوْ وَزْنٍ (مَعَ الْجِنْسِ فَإِنْ وُجِدَا حَرُمَ الْفَضْلُ) أَيْ الزِّيَادَةُ (وَالنَّسَاءُ) بِالْمَدِّ التَّأْخِيرُ فَلَمْ يَجُزْ بَيْعُ قَفِيزِ بُرٍّ بِقَفِيزٍ مِنْهُ مُتَسَاوِيًا وَأَحَدُهُمَا نَسَاءٌ (وَإِنْ عَدِمَا) بِكَسْرِ الدَّالِ مِنْ بَابِ عَلِمَ ابْنُ مَالِكٍ (حَلَّا) كَهَرَوِيٍّ بِمَرْوِيَّيْنِ لِعَدَمِ الْعِلَّةِ فَبَقِيَ عَلَى أَصْلِ الْإِبَاحَةِ (وَإِنْ وُجِدَ أَحَدُهُمَا) أَيْ الْقَدْرُ وَحْدَهُ أَوْ الْجِنْسُ (حَلَّ الْفَضْلُ وَحَرُمَ النِّسَاءُ) وَلَوْ مَعَ التَّسَاوِي، حَتَّى لَوْ بَاعَ عَبْدًا بِعَبْدٍ إلَى أَجَلٍ لَمْ يَجُزْ لِوُجُودِ الْجِنْسِيَّةِ
ص172 – كتاب حاشية ابن عابدين رد المحتار ط الحلبي – مطلب في الإبراء عن الربا – المكتبة الشاملة
(المضاربة) لغةً: مشتقة من الضرب (١) في الأرض، سمى به لأن المضارب يستحق الربح بسعيه وعمله، وشرعاً: (عقد) بإيجاب وقبول (على الشركة) في الربح (بمال من أحد الشريكين) وعمل من الآخر، كما في بعض النسخ، ولا مضاربة بدون ذلك؛ لأنها بشرط الربح لرب المال بضاعة، وللمضارب قرض، وإذا كان المال منهما تكون شركة عقد.
ص131 – اللباب في شرح الكتاب – كتاب المضاربة – المكتبة الشاملة
وَشُبْهَةُ الرِّبَا مَانِعَةٌ كَحَقِيقَةِ الرِّبَا) بِالْإِجْمَاعِ
ص12 – كتاب فتح القدير للكمال بن الهمام ط الحلبي – باب الربا – المكتبة الشاملة
حَدَّثَنَا قُتَيْبَةُ بْنُ سَعِيدٍ، أَنْبَأَنَا حَمَّادُ بْنُ زَيْدٍ، عَنْ مُجَالِدٍ، عَنِ الشَّعْبِيِّ، عَنِ النُّعْمَانِ بْنِ بَشِيرٍ، قَالَ سَمِعْتُ رَسُولَ اللَّهُ صلى الله عليه وسلم يَقُولُ “ الْحَلاَلُ بَيِّنٌ وَالْحَرَامُ بَيِّنٌ وَبَيْنَ ذَلِكَ أُمُورٌ مُشْتَبِهَاتٌ لاَ يَدْرِي كَثِيرٌ مِنَ النَّاسِ أَمِنَ الْحَلاَلِ هِيَ أَمْ مِنَ الْحَرَامِ فَمَنْ تَرَكَهَا اسْتِبْرَاءً لِدِينِهِ وَعِرْضِهِ فَقَدْ سَلِمَ وَمَنْ وَاقَعَ شَيْئًا مِنْهَا يُوشِكُ أَنْ يُوَاقِعَ الْحَرَامَ كَمَا أَنَّهُ مَنْ يَرْعَى حَوْلَ الْحِمَى يُوشِكُ أَنْ يُوَاقِعَهُ أَلاَ وَإِنَّ لِكُلِّ مَلِكٍ حِمًى أَلاَ وَإِنَّ حِمَى اللَّهِ مَحَارِمُهُ ” .
An-Numan bin Bashir narrated that the Messenger of Allah (S) said: “The lawful is clear and the unlawful is clear, and between that are matters that are doubtful (not clear); many of the people do not know whether it is lawful or unlawful. So whoever leaves it to protect his religion and his honor, then he will be safe, and whoever falls into something from them, then he soon will have fallen into the unlawful. Just like if someone grazes (his animals) around a sanctuary, he would soon wind up in it. Indeed for every king is a sanctuary (pasture), and indeed Allah’s sanctuary is what He made unlawful.”
Jami` at-Tirmidhi 1205
Chapter 1: What Has Been Related About Matters That Are Not Clear, Book 14: The Book on Business
Grade: Sahih (Darussalam)
https://sunnah.com/tirmidhi:1205
Only Allah (عز و جل) knows best.
Written by Maulana Sakib Shadman
Checked and approved by Mufti Mohammed Tosir Miah
Darul Ifta Birmingham