Resolution No.(75): “System Applied by the Housing Fund of Jordan Phosphate Mines Company“
Date: 22/3/1425, corresponding to 12/5/2004 AD.
The Board received the following question:
What is the ruling of Islamic Sharia on the system applied by the housing fund of JPMC?
Answer: All success is due to Allah.
The Board is of the following view:
1- Loans granted by the above fund entail usurious interests as indicated in articles (9, 15, 16, 17, and 18) and this violates the rules of Sharia pertaining to the prohibition of usurious loans, for Allah Says in this regard: “but God hath permitted trade and forbidden usury.” {Al-Baqarah/2}.
2- Deducting (500fils) from the salary of every subscribing employee as a contribution for social solidarity is permissible according to Islamic Sharia, because it is based on cooperation which is promoted by Islam. Allah The Exalted Says in this regard {What means}: “Help ye one another in righteousness and piety, but help ye not one another in sin and rancour: fear Allah, for Allah is strict in punishment.” {Al-Mai`dah/2}.
3- Deducting (0, 0015) annually from the value of the loan (as an allowance for services provided by the fund and for social solidarity) isn`t permissible in Islamic Sharia because there lies the reason behind the prohibition of usury. However, it is permissible to deduct a specific, reasonable and fixed sum in return for administrative services of each loan, regardless of its amount and repayment span since the effort involved is the same. Nonetheless, there should be no mixing between the sum charged in return for administrative services and that charged for social solidarity.
4- Housing and life insurance of subscribers isn`t permissible in Sharia because it involves usury and gambling, which are classified as contracts of uncertainty and compulsion. And Allah Knows Best.