Questions regarding Deposit

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

1)    It is permissible to invest your money in a Shari’ah Compliant investment scheme. Seek advice from your local esteemed ‘Ulamaa’ on which schemes are Shari’ah Compliant.

2)    An individual’s loss in an investment will depend on what type of scheme the investment is based on. The investment can be based on either:

a)    Mushaarakah: in this case, one’s loss will be proportionate to the ratio of his investment.  

b)    Mudaarabah: in this case, there are two possibilities:

A)  If one is the financier, he will bear all the loss. If there are multiple financiers, they will all bear the loss in proportion to the ratio of their investments.

B)   If one did not invest any money but does the labour, he will not bear any loss. His loss will be the loss of his labour.

And Allah Ta’āla Knows Best[1]

Muhammad Haris Siddiqui

Student Darul Iftaa
Melbourne, Australia 

Checked and Approved by,
Mufti Ebrahim Desai.

(10/11/2014)