Bond Mutual Funds
Thank you Mr Faisal. Can we expand on this discussion. I have heard Dr. Ghamdi’s lectures where he says that paying interest on financing is permissible. What sort of financing is he referring to. In today’s world, a company requires short term overdraft facilities to meet their liquidity requirements, raises capital for new projects through loans and bonds, also raises debt capital for general corporate purposes which may include refinancing of existing loans and bonds. Which ones of these debt forms are not permissible and are contrary to the principles of justice in our religion. My understanding from listening to Dr. Ghamdi is that they are all allowed for the companies active in permissible activities. Now my second part of the same question. If these are permissible, then investing in these forms of debt in the form of market securities and funds should be permissible as well, isn’t it? This is the way capital gets directed from savers to companies for companies to invest in commercial activities that create socio economic opportunities. Appreciate your guidance.