Prize won by having account in interest-based bank
23-5-2017 | IslamWeb
Question:
Assalaamu alaykum. I have a question about a motorbike that I got from my father. My father opened an account in some conventional bank (which is interest-based), an he got a prize because of that, a motorbike; this was in 2008. Now, prior to 2016, I never realized that using anything from an interest-based bank is haram, and my father did not seem to know either at the time. (He does now.) My question is: is it permissible to use this motorbike; and if not, then what should I do with it? May Allaah reward you well.
Answer:
All perfect praise be to Allah, The Lord of the worlds. I testify that there is none worthy of worship except Allah and that Muhammad 
is His slave and Messenger.
Such a prize is considered interest; the fatwa of the Permanent Committee reads:
“Depositing money in the bank without interest is permissible if you are obliged to do so, but it is not permissible to take the monetary prizes that your account wins, as this is interest because this was only given to you due to the money that you had deposited in the bank. The fact that they name what they give you a prize or reward does not exclude it from the meaning of interest, because it is the facts that have to be taken into account, and not the names that are given to them. If your money had not been in their hands and they had not exploited it for their benefit, they would not have given you the amount which they call a prize. Therefore, it is not permissible for you to take these prizes.”
However, according to the view of some scholars, the fact that your father did not know the Islamic ruling when he got this prize makes it permissible for him to benefit from it.
Al-Ikhtiyaarat Al-Fiqhiyyah, which was authored by Al-Ba’li, reads:
“If a person gained forbidden money with the consent of the one who gave it and then repented, such as the price of wine, the fee of a prostitute, and the fee of a soothsayer, then what can be concluded from the statement of Ibn Taymiyyah is that if the one who receives the money did not know that it is forbidden and then later came to know that it is forbidden, it is permissible for him to consume it, and if he knew from the beginning that it was forbidden and he then repented, then, in that case, he should give out that money in charity.”
Therefore, since it is permissible for your father to benefit from that prize due to his ignorance (at the time) that it is forbidden, then it is permissible for you to benefit from it with greater reason.
Now that your father knows the Islamic ruling, he should withdraw his money from the interest-based bank, and the interest that he received after having learned that it is forbidden should be spent in good causes and in the general welfare of the Muslims. For more benefit, please refer to fatwa 92106.
Allah knows best.