The Office of the Supreme Leader

Ribā on loan

Q . What is ribā? And is the amount calculated as a percentage taken by the people who have deposits with the banks regarded as ribā?

A: As an expression, a ribā-bearing loan involves paying an extra amount by the borrower to the lender. The profits arising from the investment of the money deposited with a bank for safe keeping, which is used by the bank on behalf of the saver by virtue of an Islamic contract, is not considered ribā and, thus, is not problematic.


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