Fatwa Interest in CPF Account

ADMINISTRATION OF MUSLIM LAW ACT

(CHAPTER 3, SECTION 32 (2))

FATWA (RULING) ISSUED BY LEGAL (FATWA) COMMITTEE, MAJLIS UGAMA ISLAM SINGAPURA

QUESTION DATED 6 MARCH 2003 FROM A LAW FIRM ON THE SUBJECT OF INTEREST IN CPF ACCOUNT.

FATWA ISSUED

حمدا وصلاة وسلاما

1. The Legal (Fatwa) Committee received a question on the subject of interest in CPF account. They requested for the rulings on:

          i. Is interest paid by CPF Board to CPF member’s account riba and therefore haram?

          ii. Is it lawful under Islamic law for a wife to claim the interest in the husband’s CPF account?

          iii. Is it lawful for an Islamic Court e.g. the Syariah Court, Singapore to order division of the interest accrued in the husband’s CPF account following a divorce?

2. After deliberating on the issue, the Legal (Fatwa) Committee ruled that the interest paid by CPF Board to CPF member’s account is not riba as it is not a gain from a loan, debt, or pawn transaction.  Instead, it is a form of gift with no conditions.

3. The Fatwa Committee is also of the opinion that questions (ii) and (iii) is of a judicial matter that should be referred to the Syariah Court, Singapore.

الله أعلم ، وبالله التوفيق ، وصلى الله على سيدنا محمد وعلى آله وصحبه وسلم.

SYED ISA BIN MOHD BIN SMITH

MUFTI OF SINGAPORE

CHAIRMAN, LEGAL (FATWA) COMMITTEE

MAJLIS UGAMA ISLAM SINGAPURA