Is Saving Account Halal or Haram? 

Savings are a priority for people who save.

Many learn this habit as children, many start saving in their forties, and many find saving difficult. If there is a will and a goal, it is possible to save money.

Many have followed the oft-repeated advice and succeeded.

In these volatile times, it sounds like a good idea to save some money, and this is somewhat standard practice, and for the majority of people, this is something that all of us should practice so that later on we can use that money for something important.

Some people save for their kid’s school, others save for their pension fund, and so on.

Saving some money not to worry in later years, sounds like a reasonable idea.

Now, this is something that stands as an obligation that all people should

do for themselves, but in the Islamic religions, we wonder if is there anything that could prevent them from saving.

Is there anything that is seen as a contradiction to their regulation?

The principles of Islamic banking are different from conventional banking.

Primarily, the operating system of “halal financing” is based on several fundamental assumptions in which there are no big mysteries and the idea of the unknown is reduced to minimal, and the other important part is that there is no any Western interest.

They, apart from the state ones, imply above all respect for religion.

We will look into this matter.

Is Saving Account Halal or Haram?

When we are looking into any regulations regarding this matter – first we need to take a look does this fall under strict regulation or does fall under some practical duty, that is regulated by numerous regulations.

What kind of situation is today, as we know that all of us are living in a world of digital banking, and cryptocurrency, so all people and the includes Muslim community want to save for the future.

And for all people who are not Muslims, having savings accounts is a great way to obtain some money, without any risk.

But the people who belong to the Muslim community should do it in the right way, that it is aligned with their law.

So the primary difference between traditional savings accounts and

Islamic ones are that the Islamic one is aligned with the Sharia law.

As conventional pay interest to clients (fixed amount) and Islamic ones share profit and does not promise any fixed return. But there is a promise that they will share the profit with the client.

So, we can say that it is haram to have a conventional savings account – unless you have a saving account in an Islamic bank, then it is permitted.

These accounts work in a way that they are paying clients a profit rate, but the profit has come from halal investment, and it is not guaranteed, nothing is fixed.

this means for sure that the person who has savings in that bank would not receive anything if the investment fails, as can happen.

But, this is not anything to be worried about, as in the majority of cases these banks work just fine, and clients have profit.

But have one thing in mind also the Sharia principles imply that investors will share losses and also profit.

Have in mind that when you invest in such a bank, all clients who have deposited money have an opportunity to withdraw their investment before the end of the time if there’s a possibility that the anticipated profit rate will not be reached.

But, in the majority of cases, banks create a profit and occasionally even earn more than they have expected, adn this is something that they will share with clients who have invested their money in this bank.

So, all in all, it is made so that there is a great chance to make money, then to lose it.

Three financial concepts in Islam

In many cases, according to Islamic rules and regulations, what is forbidden to people of faith, is also forbidden to bankers.

For example, this may be the simplest way to understand this concept, just as a Muslim may not consume alcohol, so a banker may not invest in the production of alcohol.

According to Sharia, money does not represent a value by itself, it is forbidden to “create money from money”, that is, to take an interest, and from this alone, the majority of haram in the financial sector comes to the surface of Islamic finances.

Instead, the Islamic bank and the client enter into a partnership relationship and jointly purchase an asset or invest in a business. The client of the bank, among other things, can gradually purchase the share owned by the bank or, if it is a business investment, the bank will share the profit and loss with the client.

In the Islamic religion, there are three main concepts:

The first one is riba which implies an interest in a certain transaction, and this includes borrowing money.

Then we have risky transactions like for example gambling, and third, we have nonharam investments that imply all investments that include non-Islamic activity, like investing in alcohol production.

Islamic banks, therefore are not permitted to lead speculative business either, investments must be, as far as practicable, safe, and free from uncertainty, business is based on real, material values.

Of course, banks that operate according to the rules of Islam are not prohibited from making a profit, they are only prohibited from doing so by charging interest.

And if we want to take a look at this waste market, we can say that currently, even in this volatile market, more than 300 banks around the globe work under Islamic rules.

They, of course, most commonly do their work in the world, mostly located in Arab countries, but this is not limited to Arab countries only.

There is much more to it – Islamic banks are successfully working in the counties like the USA, Great Britain, Australia, and France.

What if a Muslim already has a conventional savings account?

If for some reason a Muslim has such an account the most meaningful thing is if gained any interest from the bank, he does not take it for himself but gives it to charity.

Islamic financing is one of the fastest-growing sectors in the global financial system, especially in the conditions of the global crisis, when interest in alternative forms and styles of investment is growing.

All of us have become a witness that everyone is announcing a new crisis.

Islamic financial organizations are very important for the Muslim community, and they work according to the Sharia laws, as they do not utilize interest when placing financial assets, like for example loans, which is unjust and inappropriate according to Islamic teaching.

Islamic financial theorists notice an choice in the essential values and education of Islam, the Quran, and the Sunnah, which rigorously prohibit interest.

If things work in such a way, then Islamic banks can receive specific proximate benefits over other financial institutions.

It is in a place to be able to designate quality company relationships with customers from Muslim communities, both in the company of domestic firms in their markets and in the actuality of companies from Islamic places in any market.


As you were able to see, having a saving account can be seen as haram, as banks, at least the conventional ones pay back with interest, and doing so is seen as haram.

But, you can always opt and you should opt for saving in Islamic banks as they are halal.

There, there is a smaller chance that you will earn some money, and there is a risk, but there is a chance to make some money, and you do it all based on the Sharia law, as the only proper way to do it.

Have in mind that traditional savings accounts give interest to the client, but in the matter of Islamic savings accounts there is something that is called profit sharing, and it is something that is according to Sharia laws, but at the same time it can bring interest, and it does not have to.

In the end, we have to say that the people of the Islamic religion usually, because of the risk, and because they want to deal with injustice, and also social inequality do not want to have any interests, as this is something that is against all Islamic beliefs.

But, there is something that all Muslim people could do, if they want to save their money for the future and make some money along the way, in alliance with the Sharia law.

They can do it in Islamic banks, as there are savings accounts done in Islamic ways, and they can keep their investment safe, and also along the way they are sharing the profit, and also losses with the bank.

And, as Islamic teachers like to point out – in the end, only Allah is the one who provides it all.

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