Is it permissible to give interest money to a poor Muslim?
Published as Giving Interest funds to a poor Muslim
Question
Is it permissible to give interest money to a poor Muslim? Or should we give it only to non-Muslims?
Answer
Yes, if a Muslim received such funds, it is permissible and better to give the interest money to a poor Muslim who is eligible to receive Zakat without the intention of reward.
However, if one gives it to a poor non-Muslim, this is also permissible. [Fataawa Raheemiyyah 9/279]
Note: It should be noted that to deliberately involve oneself in interest bearing transactions is Haraam and is considered a Major sin. Shariah strictly prohibits and condemns all forms of Riba. Taking and giving of interest is impermissible.
And Allah Ta’ala Knows Best
Where scholars differ, it’s safer to take the more cautious view.
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Source: Jamiatul Ulama KZN — https://jamiat.org.za/giving-interest-funds-to-a-poor-muslim/
Fatawa SA: https://fatawa.co.za/fatwa/jamiat-39843