Pakistan Stock Exchange – Borrowing From The Broker & Paying Commission
As far as this specific transaction is concerned , the amount provided by the broker is indeed a loan, and the weekly charge applied to it functions as interest. However, the condition that interest (commission) is only charged after one week changes the nature of the transaction. Because riba refers to an unconditional excess demanded on a loan, this conditional structure prevents it from being classified as absolute riba in the strict jurisprudential sense. As a result, such transactions may not be deemed completely haram , though they remain undesirable or discouraged . Avoiding them is still preferable whenever possible. A far better alternative would be for the broker to treat the amount not as a loan but as an investment, sharing in the profits or dividends generated from the stocks purchased through that investment. This structure would eliminate the risk of riba altogether. Regarding the payment of interest , it is worth noting that according to Javed Ahmed Ghamidi, in societies where riba is not prohibited at the state level, the primary religious prohibition applies to consuming or charging interest—not to paying it.