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I am a Muslim undergraduate student in the US who is contemplating career options and thinking about the finance track that a lot of undergrads gravitate towards (positions in investment banking or investment management, for example). I attend a school where a good number of students go into finance and there are sizable resources (career center, alumni,etc. ) to help students with this route.

I do have hesitations/some questions from an Islamic point of view, the most obvious of which is the issue of riba/interest. Many of the roles in finance, unsurprisingly, directly deal with interest - an investment banker issuing stocks and bonds on behalf of a company, a wealth manager advising a client to invest a portion of his or her portfolio in certain bonds, etc. Even if one's work is not directly involved with interest/riba - maybe working as an accountant for a bank or strictly doing mergers & acquisitions, where you gain fees from services - most financial institutions gain a substantial portion of their profits from interest-based activities and have operations in the sourcing, processing, and vetting of interest-based products or transactions.

My question then is: is it permissible to work in a financial institution, even if you work in a role that does not directly deal with riba? For Muslims working in finance, either in work that directly or do not directly involve riba, how do you think about this issue?

I realize that virtually all companies and industries deal with riba at some level - loans, bonds, etc - but there is a difference between working in a company/industry that actively leverages, and uses interest to make a profit versus say, a beverage company that is short on cash and perhaps uses interest to gain short term capital, but interest is not the main engine for business operations and profit.

The prestige, pay, and exit options for such careers are of course very alluring, and why many of my peers take this route, but given the serious nature of riba in Islam, I just need some perspective on this. Perhaps I am being too serious or idealistic in the world we live in, or am I thinking about this right?

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    Actually, tangential involvement with riba is perhaps the least of the potential issues here. If you are a trader, there are practices like shortselling that are impermissible. Dealing with futures, options, etc. The larger picture of exploiting the disadvantaged, activities that translate into unethical practices on the ground, and the list goes on. You will have to evaluate the components of each job and decide accordingly. – Ansari Jan 20 '15 at 0:19
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The nature of riba in Islam

How do you think about this issue?
I need some perspective on this, but perhaps I am being too idealistic in the world we live in?

NO, you are definitively not too idealistic. Ethical investment is a very important issue in the world we live in. Indeed, your question shows that you have great honesty in your faith. This will be accounted for when the time will be ripe for you.

Is it permissible to work in a financial institution, if I do not deal directly with riba? If interest is not the main engine for business operations and profit?

Another way to put your question would be to say to the police officer : I was just holding the bag with stolen items, I was just driving the car, I did not steal myself.

Working for a financial institution means that you are like the doorman, the driver or the janitor. Most financial institutions in the US make their money with riba. Riba and speculation by financial institutions are responsible for the 2008 krach. Many people suffered because of their actions. You have the right to question them.

The prestige and the salary in such careers are very tempting for you.

Prestige, honours and money are not assets that will be accounted for when you die. BUT A good income will make things easier for your family. A good salary will also give you the opportunity to share with people less fortunate.

How do you think about this issue? I need some perspective on this.

What is your job in this financial institution? Will you the one holding the bag, driving the car or just working as a janitor, so to speak? In my opinion, some jobs respect the spirit behind the law about riba.

  • Working as a financial advisor, helping normal people with their financial security.
  • Working for a non profit organisation, helping to raise funds.
  • Help manage an islamic investment fund.

Choosing to work in a financial institution is walking on a very fine line. It is easy to fall prey to the prestige, the honours and the money. Check this website on islamic finance.

May you choose the right path and walk without falling down. If in doubt, ask for guidance to Allah.

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