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f:211 -    Investing money in business
Country : India,
Name : Abdullah
Question:     I have a childhood friend who wants to start some business.  He has asked me to invest money in it and is telling me that we will share the profits between us.  Is such money Halal for me or will it be considered interest?
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Answer:     If the business of your friend is permissible, then you may fix some percentage of the profit for yourself and your friend (like 50%-50%).  In this case, the profit will be permissible.  Please remember that it is not permissible to fix a certain amount (like Rs. 5000, 10,000) etc. as the share of the profit.  At all times, only the percentage of the profit should be fixed.  Your percentage in profit should also be your percentage in losses.

On the other hand, if you give him the money as a loan, then even 1 rupee more than the given amount is usury.  In case of a loan, then regardless of profit or loss in the business, your friend has to repay the loan.

You are helping your friend monetarily.  Allah Most High will give you the reward for it.

And Allah (Subhanahu Wa Ta'ala) knows best.

Mufti Syed Ziauddin Naqshbandi Qadri

[Professor, Islamic Law, Jamia Nizamia,
Founder-Director Abul Hasanaat Islamic Research Center]
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