Is It Halal To Work In a Bank?
Most Islamic scholars agree that working in an Islamic bank is entirely halal. Since conventional banks involve interest-based transactions, which are prohibited in Islam, scholars dispute whether working there is permissible.
Bank jobs are considered good these days which can be much more beneficial than regular jobs. Yet Muslims need to know whether they can work in banks or not. The most important factor is the interest which is known as riba in Arabic.
You can read more if you like to get all the information related to Muslims and working in banks.
Shaikh explains this beautifully in the following video:
Is It Halal To Work In a Bank?
The most important factor here is interest. All modern banking systems include interest-based transactions. The banking system is structured in such a way that interest plays a significant role in a bank’s profitability.
In Islam, interest is haram or something that Muslims are not permitted to participate in.
This participation includes interest-based transactions for you. Islam still prohibits taking part in any transaction, even if it is not related to you directly.
All Islamic banks are interest-free and work on profit-and-loss methods of earnings. As there is no interest involved in Islamic banking to work in one is 100% halal for Muslims and agreed by all the Islamic scholars.
On the other hand, scholars differ from one another creating doubt about whether Muslims can work in a conventional bank or not.
Some say if your job directly does not involves interest-based transactions even if you work in a conventional bank then that job is halal and others consider it haram.
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Can Muslims Work In Banks?
There are different rulings of Islam about working in banks depending on the nature of banking. There are two types of banks these days. Conventional and Islamic. Both have a different sets of rulings.
Working In An Islamic Bank
Islamic banking is a modern way of banking and usually works in Islamic countries. They tend to work in a different way and avoid all interest-based transactions. Even the bank itself does not involve any interest in its own profitability.
As there is no interest (riba) involved working in an Islamic bank is totally deemed halal by all the Islamic scholars around the globe.
Working In A Conventional Bank
In this regard, Muslim scholars differ. Some argue that working in a traditional bank is acceptable as long as you are not directly accountable for any interest-based transactions that occur in the bank.
A security guard is an example of such a profession in a bank that just defends the bank and its customers and has no involvement in interest-based transactions.
Prof. Dr. Monzer Kahf of Islamic Finance and Economics at Qatar Faculty of Islamic Studies says:
“Working in a bank is permissible. This does not mean it is one of the best jobs a Muslim may have.
However, signing any interest-based transaction or writing it or reviewing its correctness for the purpose of signing it or approving it and the like are all haram and a Muslim should avoid doing it.”
[source]
Here he is referring to all the Muslims working in conventional banks and are not directly responsible for the transactions involving interest (riba). These sorts of bank jobs might be halal as he and some other scholars agree that the job and pay are for the job not involving interest.
He also added that these jobs might be halal or allowed but still not preferable for Muslims. In some extreme circumstances, Muslims might work but if they have an opportunity they should opt for other jobs.
One more fatwa of Darul Ifta India implies this:
“If you have to record interest-based calculation, then it is not lawful.
[source]
A Muslim should avoid it. However, the job of peon or guard is allowable.”
Other Islamic scholars say that working any job whether involving interest or not is haram in a conventional bank.
Quran says:
“Cooperate with one another in goodness and righteousness, and do not cooperate in sin and transgression.”
[Quran 5:2]
This verse of the Quran tells Muslims to help one another but not in something which is prohibited. Interest (riba) is something that is haram or prohibited in Islam and helping one another in interest-based transactions will also be considered haram.
There are strong warnings in the Quran and Sunnah regarding interest (riba), but it is now accepted as an essential part of the global economy.
Dr. Zakir Naik states in the following video that all conventional bank jobs are haram for Muslims:
Interest is also stated haram in the Hadith of the Prophet (peace be upon him):
“Jabir said that Allah’s Messenger (ﷺ) cursed the accepter of interest and its payer, and one who records it, and the two witnesses, and he said: They are all equal.”
[Sahih Muslim 1598]
Hadith tells us that Muslims should not involve in interest in any regard and if one Muslim interacts in interest (riba) or in any acts of interest whether to just write it down he or she is cursed by the Prophet of Allah (peace be upon him).
This hadith is the biggest warning Muslims need as no Muslim would want to be cursed by the Prophet (peace be upon him) himself. Hence Muslims should avoid working in conventional banks.
Final Thoughts
Working in an Islamic bank is totally safe and halal.
It is best to avoid taking a job in a commercial bank that involves interest trades and negotiations. It is forbidden to aid and assist others in their business dealings that involve interest.
If you are already employed at a conventional bank don’t quit your job right away. First, try to find a good alternative then switch. Islamic scholars suggest that quitting can be hard on some people in today’s economy. If you succeed in getting a nice job you should quit as soon as possible.
Quran says:
“And whoever puts their trust in Allah, then He ˹alone˺ is sufficient for them. Certainly Allah achieves His Will. Allah has already set a destiny for everything.”
[Quran 65:3]
Allah is enough and Muslims should always consider halal jobs allowed us in all respects.
And Allah Knows Best.
