Working as director of a company that took loans with Riba

29-7-2003 | IslamWeb

Question:

My father is the director of a company that took Riba loans from banks. My father didn't take the loans but now he is obliged to pay interests to banks knowing that the loans have been already spent in investments. Is his work Haram knowing that apart from this problem all his work is technical? In case the work is Haram, what should his children and wife do knowing that they depend financially on him?

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Answer:

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger.

 

Indeed, the owners of this company have committed a major sin by taking interest-based loans. They must repent from this act and should give back only the capital amount which they had taken from the banks. If they are obliged to pay the extra amount, i.e. interest, then they may pay it and should seek Allaah's Forgiveness.

However, working in the company is allowed if one works in a lawful field. Because the money that was taken by Riba (interest and/or usury) is used in lawful fields, i.e. business, so it becomes lawful, but the right of the money lender (bank) is due on the indebted person. However, the money that is not used and remained as taken from the bank should not be used and should be given back to the bank because such money is forbidden.

Allaah Knows best.