Ruling on requesting a guarantee from a riba-based bank?
Question

                I am intending to star a new company in pakistan. i need to know that if there is a govt rule or compan policy to have or show bank gurantee than is it be Halal or Haram.?

If haram, than is there any other option to avail the tender.?

Some of my friends are saying against the hadith and your fatwa that even the job of a door keeper in such organisation is haram.
Praise be to Allah.
	The bank guarantee is a limited-time, irrevocable, binding 
	commitment that is issued by the bank at the request of another party (a 
	customer of the bank) to pay a certain amount of money, at the request of 
	another party that has an interest with the customer, in return for the 
	customer entering into a bidding process or carrying out a project properly, 
	according to specifications, so that the beneficiary will benefit from this 
	guarantee if the customer delays or falls short in carrying out what he 
	committed to do for the beneficiary with regard to the bidding process or 
	carrying out a project and the like. In that case the bank will deduct from 
	the customer what it paid to the beneficiary.

	End quote from Fiqh an-Nawaazil by Dr. Bakr ibn 
	‘Abdullah Abu Zayd (1/201)

	Based on that, the letter of credit – that is not covered – 
	is a guarantee from the bank regarding the customer. Therefore it is not 
	permissible to charge a fee for it, because giving the guarantee is regarded 
	as an act of charity, and because of what that may lead to of falling into 
	riba.

	That is because the guarantor (the bank) is committed to pay 
	the debt on behalf of the person who is guaranteed, if he does not pay up, 
	and if the guarantor (the bank) pays on his behalf, it becomes a loan and 
	the fee for giving the guarantee is something extra to the loan, so it is 
	riba.

	Ibn al-Mundhir (may Allah have mercy on him) said: All the 
	scholars from whom we acquired knowledge are unanimously agreed that 
	offering a guarantee in return for a fee taken by the one who gives the 
	guarantee is not lawful and is not permissible.

	End quote from al-Ishraaf ‘ala Madhaahib Ahl al-‘Ilm 
	(6/230)

	Ibn Jareer at-Tabari (may Allah have mercy on him) said in 
	Ikhtilaaf al-Fuqaha’ (p. 9):

	If a man gives a guarantee to another man to pay money he 
	owes to a third man, in return for a fee that the one who is guaranteed 
	agreed to pay, the guarantee on that basis is not valid. End quote.

	Ibn Qudaamah said in al-Mughni (6/441):

	If he says: Guarantee me and I will give you one thousand, 
	that is not permissible, because the guarantor is obliged to pay the debt 
	(on behalf of the one whom he guaranteed), so if he pays it, the one who was 
	guaranteed owes him; therefore it becomes like a loan, so if he takes 
	compensation for that, it becomes a loan that brings benefit, and that is 
	not permissible.

	End quote.

	It says in a statement of the Islamic Fiqh Council concerning 
	bank guarantees:

	Firstly: Bank guarantees of all kinds are either with or 
	without coverage. If the guarantee is without coverage, then the guarantor 
	becomes liable for whatever the guaranteed person is liable for, and is 
	bound by the consequences, now or in the future. In fact this is what is 
	meant in Islamic fiqh by the term damaan or kafaalah (guarantee).

	If the bank guarantee is covered, then the relationship 
	between the one who requested the guarantee and the one who issued it is a 
	relationship of wakaalah (appointing someone to do something on one’s 
	behalf), and wakaalah is valid with or without payment, so long as the 
	purpose of the guarantee is to serve the interests of the beneficiary (the 
	one to whom payment is guaranteed).

	Secondly: kafaalah (guarantee) is an act of charity that is 
	intended to show kindness and grant relief, and the fuqaha’ have stated that 
	it is not permissible to receive compensation for that, because in the event 
	of the guarantor paying the amount he guaranteed, it becomes akin to giving 
	a loan that brings benefit to the lender, and that is prohibited according 
	to sharee‘ah.

	The following was determined:

	Firstly: that it is not permissible to charge a fee for the 
	bank guarantee in return for offering a guarantee – where the amount of 
	money and the timeframe are mentioned – whether it is with or without 
	coverage.

	Secondly: charging administration fees for issuing bank 
	guarantees of either type is permissible according to sharee‘ah, so long as 
	care is taken not to charge more than the usual charges for such procedures. 
	If full or partial coverage is offered, it is permissible to figure out the 
	real costs of issuing the guarantee. End quote from Qaraaraat Majma‘ 
	al-Fiqh al-Islami (p. 25)

	In the first conference of the Islamic Bank of Dubai, the 
	following statement was issued:

	Bank guarantees involve two things: wakaalah (asking someone 
	to act on one’s behalf) and kafaalah (guarantee).

	It is not permissible to charge a fee for kafaalah 
	(guarantee), but it is permissible to charge a fee for wakaalah (asking 
	someone to act on one’s behalf). But with regard to the fee for wakaalah, 
	attention should be paid to reflecting the actual costs borne by the bank 
	for the purpose of offering this service, because usually when issuing a 
	guarantee there is some work that the bank carries out, according to bank 
	procedures. This work involves, in particular, gathering information and 
	studying the project for which the letter of credit will be granted. It also 
	involves what the customer requests from the bank of services having to do 
	with the project, such as collecting dues from the owners of the project.
	

	Working out the amount of the fees is to be left to the bank, 
	which should do it in such a way as to make it easy for people to carry out 
	their business, and in accordance with business norms.

	End quote from Mawsoo‘ah al-Qadaayaa al-Fiqhiyyah al-Mu‘aasirah 
	wa’l-Iqtisaad al-Islami by Dr ‘Ali as-Saaloos (p. 644).