Answer
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
Interest money must be given in a way that does not bring any benefit to you directly or indirectly. If your brother-in-law is poor and he needs help, you may give him your interest money.
In responding to your question about giving interest one to relatives, Prof. Dr. Monzer Kahf, Professor of Islamic Finance and Economics at Qatar Faculty of Islamic Studies, states:
Interest money is haram and dirty that you should give away in order to keep your own money clean. If the bad is in the money itself, we would require destroying it as in case of liquor.
But the bad in interest is in the way it reaches us. So, we give it away to charity. And it is halal for the poor to receive it because they are not acquiring it through prohibited channel.
If your brother-in-law is poor and he needs help, you may give him your interest money. But he cannot use it to pay your father’s debt as this makes you indirectly benefit from it.
Interest money must be given in a way that does not bring any benefit to you directly or indirectly.
Almighty Allah knows best.
Editor’s note: This fatwa is from Ask the Scholar’s archive and was originally published at an earlier date.