Ruling on Provident Fund
Financial Transactions,Interest,Ruling on Provident Fund
Fatwa No : 81533
Ruling on Provident Fund
معاملات / مالی معاوضات / سود
Ruling on Provident Fund
What do the learned scholars say about the issue that Iam a government employee, and a certain amount is deducted from my salary every month and the government adds ten to fifteen percent interest to this total amount, which increases our amount and finally we get that amount along with the government interest when we retire.
(1) My question is whether we should take this interest or not?
(2) If the government gives us the option that it is your choice whether you want to take this interest or not, then in that case, should we take the amount that is deducted from us along with interest or not? Please answer in the light of the Quran and Sunnah
الجوابُ حامِدا ًو مُصلیِّا ً
The excess amount paid in the name of interest on the compulsory provident fund is a part of the wages (salary), hence it is permissible to take it and use it for oneself. However, if the money in the provident fund is deducted at one's own discretion, it also is a resemblance of interest and there is a risk of making it a source of Riba, so it should be avoided.
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