Resolution No. (287)(7/2020) by the Board of Iftaa, Research and Islamic Studies: "Permissibility of Interest-Free Loans Provided by Islamic Banks"Date: 14/Ramadan/1441 Hijri, corresponding to 7/5/2020 AD.
Praise be to Allah, The Lord of the Worlds.
At its fifth meeting held on the above date, the Board reviewed the question about small and medium-sized companies support program launched by the Jordan Islamic Bank based on an agreement with the Central Bank of Jordan in a bid to address the corona pandemic(See attached copy).
After careful consideration, the Board has taken the following decision:
First: Loans which will be provided by the Jordan Islamic Bank in cooperation with the Central Bank of Jordan don`t entail any interests. Rather, they are interest-free and aim to help the financially troubled businesses pay the salaries of their staff during the corona pandemic which is sweeping the globe.
Second: The defined fees charged by the Jordan Islamic Bank on these loans cover administrative expenses-as stipulated in the agreement-and aren`t part of the bank`s profits. In fact, many Fatwas and resolutions of international Islamic Fiqh academies indicate that it is permissible to impose administrative fees on borrowers of interest-free loans so long as they (fees) are equal to the actual cost of the administrative expenses.
Third: Although stipulating loan insurance at the Jordan Credit Guarantee Company with (25.%) as an annual commission is a sort of commercial insurance , which is basically prohibit, it is allowed at the time of pandemic. The evidence on this is that the agreed upon maxims of Islamic jurisprudence affirm that necessities render prohibited things permissible. Al-Juwaini added, "General need is tantamount to individual necessity at time of affliction…….If the people ignored that need until it became a necessity, all of them would perish. Thus, they have to do what needs to be done to prevent present or future harm."{Ghayath al-Umam}.
In conclusion, little flaw is forgivable at the time of pandemic to enable communities overcome crisis with minimum loss where every member is expected to do their share of solidarity and cooperation which are the highest objectives of Sharia. And Allah the Almighty knows best.
Chairperson of Iftaa` Board,
Grand Mufti of Jordan,
Dr. Abdulkareem al-Khasawneh
Dr. Ahmad al-Hasanat, Member
Dr. Mohammad al-khalayleh
Dr. Mahmoud al-Sartawi, Member
Sheikh Sa`eid Al-Hijjawi, Member
Judge Khalid Woraikat, Member
Dr. Majed al-Darawsheh, Member
Dr. Mohammad Al-Zou`bi/ Member
Prof. Adam Nooh Al-Qhodaat/Member
Dr. Amjad Rasheed/Member
Dr. Jamil Khatatbeh/Member