Interest money in my bank account

Q: Assalam Alaikum
Hope this message is reached with good health and iman inshallah.  I have some banking questions.  For my job I needed to set up a direct deposit and since I work at the X  of X, (name withheld) I decided to open up a checking account with the X of X  Credit Union because I was told the transaction would be faster.  At the time signing up for the account I didn’t read the fine print about my new account earning interest. Its only been a couple of days since I opened the account and will close it as soon as I can. I am currently with Chase and alhumdulilah my checking account does not build interest. My savings account at Chase did build interest but I closed it as soon as I found out about it. However if I set up a direct deposit with Chase they will give me a bonus check for setting up direct deposit with them. Is it ok to accept this money since its not compounded per month/year? I don’t know much about Islamic banking, and was wondering if there are some references out there that talk about
such simple things like opening a checking account and knowing what to ask and look for so its Islamically acceptable. I guess I want a simple “Idiots Guide to Islamic Finance/Banking in the US” type of book.
JAK

Time: Sunday December 13, 2009 at 10:24 am

A: وعليكم السلام ورحمة الله وبركاته

Thank you for your kind words. Wishing you and your family the best of health as well, Ameen.

يَمۡحَقُ ٱللَّهُ ٱلرِّبَوٰاْ وَيُرۡبِى ٱلصَّدَقَـٰتِ‌ۗ وَٱللَّهُ لَا يُحِبُّ كُلَّ كَفَّارٍ أَثِيمٍ

Allah will deprive usury of all its blessings (barakah) and He causes charitable deeds to flourish. And Allah does not love any ungrateful sinner (2:276)

Your options are as follows: (based on the basic rules of interest from scholars that are practical about the matter for western audiences.)

  • Best to get an  account that does not give you any interest at all (or)
  • One should look into attaining a checking account rather then a savings account, for checking accounts work best for attaining a  minimum amount of interest or no interest at all (or)
  • If choice does not exist and interest would be given to you for whatever reason, then in such a situation merely deduct your interest (by physically withdrawing it) and give it to a poor person without the intention of reward
  • To accept a bonus check from a non-muslim bank or a bank dealing in intrest is haram. These banks deal in interest. Generally, the money they are to give you is from interest (haram) earnings. Should this be indeed the case, then one cannot use such monies on the self. Should you accept this money, you would have to give it in charity without the intention of reward.

Allah certainly knows best.

(#745  as dictated by Imaam)

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