Q. In business, is it appropriate to obtain bank loans to finance transactions, if the loan is to be repaid in monthly installments covering the principal and interest? If there is no alternative source, can one resort to this method?

H.N. Ahmed, Jeddah

A. While some scholars maintain that bank interest should not be equated with usury, others assert that it is the same as usury despite having a different name. Therefore, it is advisable to steer as far away from interest as possible. The first group of scholars base their argument on the nature of bank loans, their purpose, the method of repayment, etc. Allowing for all that, it is difficult to see how one could return an advance in a larger amount agreed right at the beginning without being close to, if not right into, usury. Therefore, my advice is not to go into such loans and to keep one’s business within one’s means.

Having said that, I should add that in cases of emergency or clear necessity or need, there may be a concession which one my benefit by. But such cases are determined according to circumstances. Each case has to be considered on its own merits. Moreover, there may be cases where the payment of more than one has borrowed may be subject to concession, but there is no need or emergency that justifies devouring usury.

Zakah on investment

Q. May I ask about what zakah is payable on money kept in a fund locked under government custody for a period lasting more than five years.

M. Amin Maniar, Jeddah

A. If the owner has no access to the funds, as in the case of contributions to a pension scheme, which are payable on retirement, then zakah is payable only on receiving the proceeds, once only. This means that if you have an investment with the government or a bank or a financial institution and, according to the terms and conditions of the contract, you cannot have access to your money, then zakah becomes payable when the investment matures and you are paid your capital with its profits. Zakah is due on all that you receive, at the time you receive it, for the whole amount. Suppose you have put 20,000 riyals for investment for a period of five years, and you receive double this amount at the end of your term of investment, then the zakah you pay is for 40,000 riyals, and it is due when you receive the money, not after a year, as some people have suggested. If this investment is in a pension scheme and when you retire you are entitled to a lump sum of, say, 50,000 riyals, then when you receive your lump sum, you should pay zakah on this whole amount at the rate of 2.5%. This is payable once only.

On your next zakah date, whatever remains with you of the amount you have received from your investment is liable to zakah with the rest of your assets in the normal way. This is in line with the normal zakah rules which makes everyone of us liable to zakah on what he or she has on one’s zakah date, provided it remains over the threshold of zakah.

No janazah prayer

Q. A man who works abroad learned that his wife had a miscarriage after five months in her pregnancy. The fetus showed signs of life, but inevitably died soon afterward. However, there was no janazah prayer before burial. How to remedy this omission?

Q.N. Ahmad, Taif

A. If miscarriage takes place before the pregnancy has completed four months, then the fetus need not be washed before burial. There is no need either to perform the janazah prayer for it. But if four months have been completed and the miscarried fetus shows signs of life, then it is treated in the same way as the death of a living person. It should be washed and prepared for burial. Janazah prayer should be offered as well.

As this was a miscarriage after five months and life was clearly indicated, someone should have offered the janazah prayer for it before burial, in the same way as it is offered for any deceased person. That this was overlooked, the situation could be corrected by the father, who may offer this prayer, even though he is in a different country. This is all that may be required in such a situation.