Question : A question was asked regarding [the validity of] opening an account for [charity and] donations in a non-Islamic bank.

Fatwa in Brief: It is illegal. The work of non-Islamic banks is illegal [i.e. banks that charge interest]; and dealing with them is therefore also illegal.

The Permanent Committee, 16/259

Response:

It is permitted to keep the money one intends to pay to charity (sadaqa) and/or in donations [to Muslim causes] in a bank account that does not pay interest.

Commentary:

It is permitted to keep the money one intends to pay to charity (sadaqa) and/or in donations [to Muslim causes] in a bank account that does not pay interest. This is because the logic underpinning the prohibition against non-Muslim banks [i.e. that they charge interest] does not apply here. Ultimately, then, providing this money is not used or treated in an illegal way, one may keep one’s money in this form of bank.[1]

And God knows best.

Dr. Anas Abu Shadi