Topics: Islamic Finance

Understanding the Ruling on Government Subsidies and Interest-Based Loans in Islam

Islamic Perspectives on Government Subsidies and Interest Loans

Question: What is the ruling on subsidies provided by the government, like loans where the government pays part and the borrower pays the rest with interest?

Answer: Subsidies come in various forms, and their rulings depend on the specific circumstances. Generally, government subsidies, like those for gas or Hajj, are permissible. However, the type of subsidy you mentioned involves interest-based loans, which is not permissible.

One reason is that taking loans from interest-based banks supports riba (usury). Additionally, even with subsidy loans, interest is involved, making such loans impermissible in Islam.

Respondent: Sheikh Maqbool Ahmed Salafi Hafizahullah 

Jeddah Dawah Center, Saudi Arabia  

Interpreter: Hasan Fuzail

Author: IslamicHelper

IslamicHelper

Recent Articles

Matam in Islam: Forbidden?

Delve into Sharia's prohibition of matam, wailing during calamities, watching mourning processions, and facts about Aisha (RA)'s actions, supported by… Read More

2 weeks ago

Salaam Between Genders in Islam

Understand Islamic guidelines on exchanging Salaam between non-mahram men and women, backed by Quran, Hadith, and scholars like Ibn Uthaymeen,… Read More

2 weeks ago

Women Cutting Hair in Islam: Allowed?

Learn if women can cut their hair in Islam, based on Hadith from Sahih Muslim and views from scholars like… Read More

2 weeks ago

Women’s Outings in Islam: Rules

Explore Islamic rulings on women leaving home for walks, recreation, or jobs, based on Quran verses and authentic Hadith, emphasizing… Read More

2 weeks ago

Reply to Javed Akhtar: Why Does God Allow Suffering?

A logical and theological refutation of Javed Akhtar’s atheistic objection regarding the existence of God and worldly suffering. This piece… Read More

3 weeks ago

Zina is a Debt” Hadith is Fabricated – Full Ruling

Zina is a debt”, “Remain chaste so your women stay chaste”, “Whoever commits zina, zina will be committed with him”… Read More

1 month ago