Question(s):
Is the Natwest Invest Personal Portfolio Fund 5 (PPF5) permissible to partake in?
Answer(s):
In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
In order to analyse the Shari’ah compliance of the investments in this scheme, each investment must be financially screened individually.
In such conventional schemes, generally, there is a high likelihood of investments of an impermissible nature. This is evident from the use of bonds and financial derivatives (amongst other possible unlawful elements), which are not Shari’ah compliant. [1][2][3]
In addition, since the Investment Manager is in total control of the investments, it is not possible for the scheme holder to opt-out of (or change) any investment choices.
Thus, one should adopt caution from participating in such schemes.
Note: Initially, it may seem like this particular scheme does not involve bonds, but based on our research and discussions with the bank itself and other senior scholars in the field of Islamic Finance, this is not likely to be the case. Moreover, even if this is the case, there are various additional nuances to consider, as outlined above, thus, the advice to avoid and adopt caution stands regardless.
And Allah Ta’āla Knows Best.
Mufti Mubasshir
28 August 2021
Note: This fatwa is only to be viewed with the question asked. In the event of presenting this to a third party, please ensure it is coupled with the original question, as well as the references below for Islamic Scholars.
Approved by: Mufti Tahir Wadee, Mufti Yusuf Ilolvi
[References]
[1]
All of the details of this scheme have been derived from the official scheme information.
Refer to: https://personal.natwest.com/personal/investments/existing-customers/personal-portfolio-funds.html
(Personal Portfolio Fund 5)
[2]
“Bond, in finance, a loan contract issued by local, state, or national governments and by private corporations specifying an obligation to return borrowed funds. The borrower promises to pay interest on the debt when due (usually semi-annually) at a stipulated percentage of the face value of the bond.”
[Encyclopedia Britannica – https://www.britannica.com/topic/bond-finance]
ولا شك أن هذه معاملات ربوية محرمة شرعا، والجواب أن شراء السندات ذات الكوبون الصفري التي تصدر بالحسم لا يجوز، ولو بقيمته الاسمية
[Fiqh al-Buyoo’, 1/342, Dar al-Qalam]
كل قرض يشترط فيه منفعة فهو حرام هذا إذا كانت المنفعة مشروطة في العقد فإن لم تكن مشروطة فدفع أجود فلا بأس
[Durar al-Hukkām, 3/94, Dar Ihya’ al-Kutub]
اس تعریف سے معلوم ہوئی کے بونڈ لینا ایک سودی معاملہ ہے جو موبقات میں سے شمار ہوتا ہے
[Fatāwa Darululoom Zakariyya, 5/361, Zamzam]
[3]
قال: “وكل دين حال إذا أجله صاحبه صار مؤجلا”؛ لما ذكرنا “إلا القرض” فإن تأجيله لا يصح؛ لأنه إعارة وصلة في الابتداء حتى يصح بلفظة الإعارة، ولا يملكه من لا يملك التبرع كالوصي والصبي ومعاوضة في الانتهاء، فعلى اعتبار الابتداء لا يلزم التأجيل فيه كما في الإعارة، إذ لا جبر في التبرع، وعلى اعتبار الانتهاء لا يصح؛ لأنه يصير بيع الدراهم بالدراهم نسيئة وهو ربا
[Al-Hidāyah, 3/60, Dar al-Fikr]
ومثل هذه الاختيارات شائعة اليوم…وإن هذه البيوع باطلة في الشريعة الإسلامية، لأن البائع لا ينقل إلى المشتري مالا، ولا حقا ماليا، فهو من قبيل أكل أموال الناس بالباطل
[Fiqh al-Buyoo’, 1/277, Dar al-Qalam]
