(Part No. 13; Page No. 356)
We conduct free trade businesses with Brazil. We possess commercial shops. At the end of each day we put our earnings in the bank for fear of theft. The value of the earnings decreases from time to time compared to the price of the dollar. For example, when I put 100 thousand Brazilian real, a sum equal to 380 dollars, their value is reduced and reaches 259 dollars within a month. The reason is that the value of the Brazilian currency is going down as a result of the general collapse of the Brazilian economy. Though I withdraw the same amount from the bank, the value of this amount has decreased. Prices of commercial goods are increasing against the devaluation of the real. The loss can only be compensated if we charge interest on the money we put in the bank. For example, the one hundred thousand reals become one hundred and ten thousand reals in case interest is charged. Thus interest compensates loss. What is your opinion? Answer us may Allah bless you! Is it permissible to charge this interest from the bank?
We would like to add that Jews and Christians constitute the majority of population in Brazil. Among every thousand Brazilian citizens, there is one Muslim. Are Muslims prohibited to conduct usurious transactions with Kafirs (disbelievers)?
rent a bank strongbox for the purpose of depositing your money and jewelry and other things such as contracts and bonds. You should not help interest-based banks in making use of your money unlawfully.
Suppose you have opened a current account in the bank for fear of theft, the purchasing value of your money will be (Part No. 13; Page No. 357) susceptible to increase and decrease according to the law of supply and demand and the prices of the world stock markets which are announced from time to time. Accordingly the purchasing value of your money may decrease at a time and increase at another time. Suppose that the purchasing value of your money is constantly decreasing, you, as a trader, may use it for trading purposes and thus you can guarantee to take possession of only an amount of money enough to meet your needs. The goods you are expected to be trading in will be subject to the law of supply and demand like all other commercial goods and real estate businesses. You may gain profit and may at the same time incur loss. It is not lawful for you to justify usurious transactions on the basis of their being conducted with a Kafir (disbeliever). You should be mindful of Allah in all your affairs and you should seek lawful means of earning your livelihood. Allah (Exalted be He) says,
And whosoever fears Allâh and keeps his duty to Him, He will make a way for him to get out (from every difficulty).
And He will provide him from (sources) he never could imagine. And whosoever puts his trust in Allâh, then He will suffice him.
May Allah grant us success. May peace and blessings be upon our Prophet Muhammad, his family, and Companions.