[Q 536] Ruling on Interest Money

QUESTION:

How and where can you use the money earned on interest?

ANSWER:

Taking and giving interest (sood — usury/interest) is impermissible (na-ja’iz — unlawful) and Haram (forbidden), and it is an action that leads to Hell. The wealth obtained from it is mal-e-haram (unlawful wealth). It is necessary to terminate the interest-based transaction and to repent from it. Along with fulfilling the requirements of Tawbah (repentance), it is also necessary to rid oneself of this unlawful wealth.

There are two possible ways to do this: either the money should be given directly — without the intention of reward (thawab — spiritual reward) — to a Shar‘i faqir (a legally eligible poor person, i.e., one entitled to Zakah), or it should be returned to the person from whom it was taken. If that person is no longer alive, then it should be given to his heirs. This latter option is better.

While clarifying the ruling of Shari‘ah regarding interest money, Imam Ahl al-Sunnah عليه الرحمة stated:
“This is the same ruling for interest and other invalid contracts (uqud-e-fasidah — corrupt/invalid transactions). The only difference is that here it is not individually Fard (obligatory) to return it specifically to the one from whom it was taken; rather, one has the choice to return it to him or to give it in charity from the outset… However, giving it to the one from whom it was taken or to his heirs is still preferable, as explicitly stated in al-Ghunyah, al-Khairiyyah, al-Hindiyyah and others.”

(Fatawa Ridawiyyah, Vol. 23, pp. 541–542, Raza Foundation, Lahore)

Answered by: Usman Madani (Ask Mufti scholar)
Translated answer
Date: 13th February 2026.