SAAD RIZWAN CH (14022034014)

M.AWAIS ARSHAD
ARSALAN ARSHAD
M.HUSSAIN

ENGLISH TRANSLATION

Numerous people have opened current accounts in conventional banks and this is the reason of
success of interest-based businesses. Normally people think that depositing money in a current
account does not offer any benefit to the account holder, the current account be it in conventional
bank or Islamic bank there is no difference.

Indeed the actually scenario is totally opposite, because the amount kept in Islamic bank
are used for legal trading and investments. Although in case of conventional bank whether you
deposit in current account or saving, in both conditions bank according to their policies will use
this money in interest-based activities. The only difference is that conventional banks let their
saving account holder be a part of profit earned by interest based activities but do not include the
current account holders in it. Due to which a current account holder preserves that his amount is
interest free. Although the bank earns more profit over a current account then a saving account.

Here it is fair to say that scholars themselves have allowed to deposit in conventional
bank. If it was wrong, scholars would not have had allowed. In this conditions it important to
understand the situation due to which the scholars have marked fatwa over it. Scholars have
allowed due to the need of hour because when Islamic bank was not introduce, people were force
to deposits their cash in interested based banks. Because of burglary and country conditions
saving money on your own was not was not easy.

Keeping this in view scholar did allow depositing money in conventional banks because
typically current account seems interest free. Scholar allowed this by keeping in view the famous
code of conduct Al balitain. Where there are two options with chances of harm, one should opt
for the one which is least harming.

To safe people from investing at wrong place or from losing all their savings scholar did
allow to open current account in conventional bank. This makes it clear that depositing in current
accounts is only allowed due to the needs of people.

Now numerous scholars claim that now our country do have number of Islamic banks
countrywide. Therefore, where there are Islamic banks run under the supervision of scholar,
people should not open their accounts in conventional banks. Because in any case the deposits in
conventional banks are use for interest based activities, which makes interest more common in
the country. Its not ethical for a Muslim to get involved in interest based activities whether
directly or indirectly.

One of the drawback of having current account in conventional bank is that conventional
bank provides a number of facilities which are not offered to saving account holders for free, for
example an ATM Card, free cheque book and free online banking. Upon this concern all scholars
have the same view that giving these facilities free is totally interest based and illegal.

In a nutshell now days Muslims have deposited billion of rupee in current account of
conventional bank which is making interest more common in the society. Therefore it is much
needed to create aware regarding interest and interest based activities so that people can make
their money free for interest.

Mental investment is need to perform a certain task. Mentally absent person cannot be a
businessman. Although this is also the case that people get business as inherit which do not result
in positive. Allah have blessed humans with wisdom to ace therefore one should keep in mind
that thinking is the key to success. People who have a habit to think over their problem tend to
perform well. Whereas illiterate and dump people are of no use to world.

Business prosper well when businessman invest mentally in their businesses. Successful
Business involves to have a strong hope. People invest in a hope of profit in their businesses, if
they came to know that there is no hope for success and they still invest in the business so people
may be out of their minds.

Allah almighty provides 9 times more profit in business then in employment but the
businessman have not idea that how should he reach to the profit. Here he needs to bring in his
wisdom and mental investment, he should think in such a way which leads him to his target. To
earn success in business other than mental investment, following qualities are also needed.

Time

Business needs time. There is an arcuate time for everything, therefore hassle wont let your
business grow but will surely destroy your business. Keeping this in view it is important to invest
an optimal amount of time in your business.

Hard work

Second important factor is hard work. If you do not work hard in and let your laziness set
in, your business wont ace. Initially one needs to investment 24 hours in his business so that it
prosper well. Its important to have patience in your business, do not lose hope and keep working
hard. Once your business starting prospering well, it will leads to success.

Honesty
 Honesty is the habit which brings out the best in your business. Not only you should stay
loyal to your business but also the employees working should stay loyal and honest. This way
there is no chance of dishonesty and loss in the business.

Experience

Experience plays an important role in your business. You should never invest in such a
business, regarding which you have no experience. Having experience will lead you to your
target much faster as you know what you are leading to. Moreover another advantage of having
experience is that you can train your employee own your own.

Before starting a business its important to keep two things in your mind. One to have
complete information before investing in, second to enroll yourself in a on job training course
related to the business. This way your business will prosper well.

New ideas

The Last thing, which is important for your business, is to have new ideas for your
business. Allah have blessed you with mentally health, which is a great source of ideas. Good
ideas are no less than a blessing. Its new ideas which leads business to success and helps to reach
in various parts of the world.

All these mentioned above are factors that will lead you to your target. Laziness, be
incompetent and inexperienced which bring down fall to your business. Islamic finance is not
like traditional debt system, they have certain business transactions which makes it interest and
riba free.

Islamic banks are involved in a number of transactions, which provides them finance.
Today we will decide only two of them. One of them is murabiha. Murabiha is an Islamic
banking of buying and selling. In which the cost and profit is clear to the buyer by the seller.

For example in case of selling fabric if the cost of that fabric is 1000 he can sell it for
1200,but it is necessary to inform the buy that the cost of that fabric is 1000 and the excess
amount is his profit.Murabiha is not a proper source of financing but we can use it for financing.
But the financing which is being made through murabiha is for limited time.

Following are the terms for an authentic murabiha:

The cost and profit should be clear to the buyer

1. Profit margin should be determined but there is no fixed amount of profit that you need to
have this specific amount as a profit. But according to the market a fixed amount of profit
can be determine.
 2. The product, which is being sold as murabiha, it is mandatory that at the time of contract
the product should be in the ownership of the seller. Otherwise the contract will be
consider void
3. The contract of murabiha should be linked to the present and if it is to be in future, it will
be consider as a void contract, because this contract is consider as a promise.
4. Murabiha of illegal or haram product is prohibited in Islam.
5. Murabiha is just used for buying and selling of product. we cannot use murabiha for the
exchange of currency moreover Murabiha can also not be used in case of debt and
borrowings

Murabiha physical stature

If you are a trader and you need money for material needed in your company, so you do
not need to borrow money on interest. But you can have it from Islamic monetary departments
on the basics of murabiha. In this way you can visit Islamic monetary departments and get your
desired material from them.

The Islamic monetary department will buy that material for you and after considering the
cost they will sell you under murabiha. Moreover the department can hire buyer as their lawyer,
so that he can buy the material, and it will be consider as a second contract. Bank will keep its
profit and will sell it to the buyer. This should be kept in mind that these will be two separate
contracts. The second contract will be held between two parties as a stage.

Problems faced by departments

Mortgage

In murabiha the payments are paid afterwards and in a shape of installments, the
customer considers Islamic departments as defaulters. To avoid this conviction the department
tends to mortgage something as security.

Gambling

There is not concept of gambling in Future trading.

It is the game of depriving money from anyone. In which the investor invest only to grab
more money. Moreover the product is not seen by the seller or by the buyer, they only gamble.
After seeking the future profit a number of gamblers do sets in. the one who wins the gamble
gets his profit from the clearing house.

Gambling in Shariah
 At the advent of Islam gambling was allowed, then as most of the things turned out to be
haram similarly gamble was also consider illegal.it is also mentioned in hadith that whoever even
says to gamble without any serious intention should sadka.

Ghaiyr mamlook

Another issue of Future trading is that the seller sells such a product which is not in his
custody. He makes this transaction with a mindset that he will buy and delivery the product
whenever demanded by the customer.

Future trading is not consider illegal in Islamic because buying and selling should be
done only of the things present in there. You cant delay it to future dates, you can promise to sell
that product in future but you cannot make a transaction in terms of future trading. PBUH said do
not sell the product which you do not have in hand.

Keeping in view the above mentioned two major sharahi problems future trading is
prohibited in Islam. Therefore as being a Muslim trader it is our duty to avoid being involved in
it.