Two types of provident funds
Financial Transactions,Interest,Two types of provident funds
Fatwa No : 80367
Two types of provident funds
معاملات / مالی معاوضات / سود
Two types of provident funds
Assalamu Alaikum!
Our company deducts a certain amount from the employee's salary every month, as a provident fund (this amount is provided to the employee on completion of his employment). An amount similar to that of employee is deposited by the company as well, in the employee's account, and thus it becomes double the amount for the employee. These are called Account (A) and Account (B). The employee has the option not to receive the profit, is it permissible to receive this profit?
الجوابُ حامِدا ًو مُصلیِّا ً
The amount received in the name of interest on the compulsory provident fund is not interest according to Sharia, but is a part of the wages (salary), hence, it is permissible to take it and use it. However, the amount that is deducted for the provident fund at one's own discretion, appears to resemble a way of Riba, and a risk of making it a source of interest, it should also be avoided.
عبد النافع رؤوف عُفی عنه
دار الافتاء جامعه بنوریه عالمیه
Fatwa No 80367 Verify Now
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