ImpermissibleCommerce, Finance & Investment · Investments
Is it permissible to invest in CD’s (Certificate of Deposits)?
The answer
A Certificate of Deposit is a savings certificate at various denominations issued primarily by commercial banks where the holder receives interest at a specified rate upon maturity.
Explanation
Unlike savings accounts, a CD has a maturity date, after which you can withdraw your funds in full with an additional interest. If you choose to withdraw before that date, you’ll have to pay an early-withdrawal fee.
Investing in Certificates of Deposits is impermissible as it is an interest bearing investment.
And Allah knows best.
Mufti Faraz Adam
Based on the Hanafi school and on the question as it was asked. Another mufti may reach a different conclusion. Read the disclaimer.