Fatwa #433641 October 2019United Kingdom
Al-Rayyan Bank Finance Schemes
Question
As Salamu Alaykum Wa Rahmatullahi Wa Baraka'tuh Shaykh,
I had a question regarding halal Mortgages. Nowadays we see a lot of 'Islamic Banks' offering halal financing methods of buying homes. One that I have been looking into a lot recently is a UK Islamic Bank by the name of Al Rayaan (https://www.alrayanbank.co.uk/). I was reading through their website and most things seemed ok however when i came across a note which said ''All finance providers require you to take out a buildings insurance policy'' it started to ring alarm bells. Their Shariah Supervisory Committee includes scholars such as: Sheikh Dr Abdul Sattar Abu Ghuddah, Sheikh Nizam Muhammed Saleh Yaqoobi, Mufti Abdul Qadir Barkatulla and Dr Samir Alamad.
I wanted to ask if you could kindly look at their 'Home Purchase Plan' and 'savings account' packages and let me know if they are Shariah compliant and therefore suitable or not. I look forward to your reply.
Jazak'Allah Khair
Answer
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
It is our understanding that the Home Purchase Plan offered by Al-Rayyan Bank is based upon the Islamic finance principles of co-ownership (Diminishing Musharaka) and leasing (Ijara).
The savings products offered include instant access savings accounts, notice savings accounts and fixed term savings accounts.
We are unable to issue a ruling without assessing and analyzing the contracts of the product. However, you may refer to the following Muftis in the UK and seek their guidance on the issue.
- Mufti Faraaz Adam (Hafidhahullaah).
- Mufti Zameelur Rahman (Hafidhahullaah).
- Mufti Hanif Patel (Hafidhahullaah).
- Mufti Muadh Chati (Hafidhahullaah).
And Allah Ta’āla Knows Best
Bilal Yusuf Pandor
Student Darul Iftaa
Lusaka, Zambia
Checked and Approved by,
Mufti Ebrahim Desai.
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