Interest-based loans to establish business : interest loan to buy a business

Fatawa Question

Assalamu Alaykum brother, I have a dilemma I am facing in my life. I am about to complete my Bachelors but have not found anything in my field. All I can do is get a job requiring no experience where I can probably make up to 30 K a year. But I always wanted to help the Muslim Ummah financially and with this kind of money, it is hard even to support yourself. I have a brother in law who is extremely smart and business minded and he has been successful in getting a job in his field and working for a grocery business owner. He has offered to go on a joint venture with me to buy an established business. We are looking at profit margins that make us more in one month than what I could make in a year at any odd job. I think it is promising but I am troubled that we would have to take out a loan from the bank and pay interest. It would take us about 10- 15 years saving the money to start a business but would take us only one year to come up with a down payment. I am wondering since I am living in USA and my soul intention is helping the poor, would it be permissible to take out the loan as long as we only use the loan to start our business and only use cash we save from our business for further expansion. Thank you

Fatwa

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Publication Date

2002-08-20

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Loans
• Business
• Usury

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-725736

• APA
• MLA
• AMA