Q&A: Overdraft and a Heter Iska
Overdraft and a Heter Iska
Question
Rabbi, I looked on Wikipedia at the concept of a heter iska, and it seemed that in its widely used form today (a loan for buying clothes or food, etc.) it really has nothing to rely on, because it is not a “business venture” with profit potential.
1. What is the Rabbi’s view? Is it permitted (even if not recommended) to go into a regular overdraft?
2. It cites there the view of Rabbi Asher Weiss, according to which since banks are limited-liability companies, there is no need for a heter iska at all. Does the Rabbi agree? a0
3. Regarding social lending (various p2p sites), here this is from one person to another, so there is not even a limited-liability company here—so is it permitted to borrow for something that is not an investment (if they have a heter iska)? And is it permitted to lend there when there is the concern that some Jew might borrow from you not for investment purposes? (They spread your money among many people…)
Answer
- Indeed, a heter iska in a case where this is not a profit-making venture is highly questionable (and I heard this as well from Rabbi Yaakov Ariel).
- Completely. I already wrote this here.
- I am not familiar with it.
Does any of the readers know about #3 and can offer a direction for an answer or a source reference? (I innocently thought that maybe there is a double doubt here: a. It could be that the borrowers are non-Jews, in which case there is no problem. b. Even if they are Jews, it could be that they are borrowing for an investment with profit potential. In addition, there are also opinions (although they are somewhat forced) that say it is permitted to borrow even not for a concrete investment purpose (Wikipedia, “heter iska”), and therefore it would seem that it would also be permitted to invest there. What do you think?