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💰 Money & work

Are Premium Bonds Halal?

Quick answer Scholars differ

UK scholars differ. Your capital is never lost, which some scholars say means it is not gambling. However, the prizes are paid from the interest the pool would have earned and are distributed by chance, which many scholars say combines riba with a lottery. Many Muslims avoid Premium Bonds for this reason.

Also asked as: “Are premium bonds haram?” · “Can Muslims buy premium bonds?”

How Premium Bonds work

You lend money to the government via NS&I. Instead of paying interest, NS&I puts a prize fund — calculated using an interest rate — into a monthly random draw. You can cash in your bonds at any time.

Why many scholars object

The prize fund is interest, and it is shared out by chance. That looks like riba distributed through a lottery.

Why some permit it

Because there is no risk to your capital, some argue it is not gambling, and that prizes are a gift from the issuer. This remains a minority view among UK scholars.

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Written by the Halal Check Online editorial team. Last reviewed 2026-10-06. How we write these answers · Suggest a correction