From previous link...

The commentary # 35 to verse 30: 39, by Scholar Mohammad Asad:

Mohammad Asad writes; In the words of Ibn Kathir (in his commentary on 2: 275), "the subject of riba is one of the most difficult subjects for many of scholars (ahl al-'ilm)". It should be borne in mind that the passage condemning or prohibiting riba in legal terms [{2: 275-281}] was the last revelation received by the Prophet, who died a few days later [cf. note [268] on 2: 281; hence the Companions had no opportunity to ask him about the Shar'i implications of the relevant injection - so much so that even 'Umar ibn al-Khattab is reliably reported to have said: "The last [of Qur'an] that was revealed was the passage [lit., "the verse"] on riba; and, behold, the Apostle of God passed away without [lit., "before"] having explained its meaning to us" [Ibn Hambal, on the authority of Sa'id ibn al-Musayyab].

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The recorded comments also inform us that although the subject of Riba is "one of the most difficult subjects", there is a "room for difference of opinion". Due to the absence of the specific directives on the subject from the Prophet (peace be upon him), to the Companions and the non existence of the conclusive concurrence over a long period, there have been varying interpretations and definitions provided by scholars for the Qur'anic term Riba.

Mufti Taqi Usmani has dealt with the subject in detail which might be beneficial for desired information:-

http://www.albalagh.net/Islamic_econ...udgement.shtml

According to Yusuf Ali's translation, his footnote in relation to surah 2 ayat 275 says that usury includes: undue profit made out of loans of gold and silver, and neccessary articles of food, such as wheat barley etc. It also includes profiteering from all kinds, but excludes economic credit.

In which case, a sharia based economy would work today.

I also took the liberty in reading another translation by Zafar Ishaq Ansari. His footnote says that their is some unsoundness of this verse (sura 2, ayat 275) since it doesn't differentiate between the profit one gains in an investment in commercial expenses (which by the way IS allowed!) and interest. He then goes on to mention that proponents of this view argue that if profit on money invested in a business enterprise is permissable, why should the profit accruing on loanded money (interest) be deemed unlawful.

I had a look in my book of Sahih Al-bukhari hadith with regards to usury/riba, but was not able to find any more meaning towards it. So for now, I think Yusuf Ali's footnote seems most suitable, since it would explain why the Islamic economy (at the time) did not falter, seeing as interest is a core part in economics and business - something that arabs at the time were well adapt with.

p.s; the Yusuf Ali footnote I used was condensed; the full version contained the passage that Gator [see two posts before this one] gave.

p.p.s; Thanks Ahsan28 for the link - will be reading that ASAP!

This reminds me of the verse:

Those who eat Ribâ (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitân (Satan) leading him to insanity. That is because they say: "Trading is only like Ribâ (usury)," whereas Allâh has permitted trading and forbidden Ribâ (usury).

[2:275]

It relates to the same verse. The footnote I gave is, if memory serves me right, just before that excerpt you posted.

The excerpt you gave is rather confusing. I think Yusuf Ali explained it in his translation, but I didn't write it down when I did for my previous post. I'll have a check on it and see if he can shed some light on it.

You are most welcome brother. Inshallah that will help remove many doubts regarding financial matters. Mufti Taqi is considered an authority on the subject.

Erm, I just realised the enormity of this aspect. I have 8 books on th Islamic economy - EIGHT!

Therefore, I think the answer is going to be of significant size and will take some time ( I spent about an hour last night researching 2 translations and Sahih Al-Bukhari in relation to this topic - and those only cover a small amount [3 or so specific ayats]. I've go 8 books left to read - each fully detailing the aspects of interest and economy!) This is going to take some time that's for sure!

8 books - yikes!!!!
have read the link from gator and part of the link from ahsan. (thanks both!). ahsan - your link looks pretty comprehensive and i'm going to try to read it all.
in all the qur'anic verses given, the word "riba" (and not "faeda") is used, as crayon said. and they do seem to point to usury = devouring - charging excessive fees. yet i find that many muslims think interest is haram, full stop. (as you brits say) some even go so far as to say it is forbidden to work in a bank. if you followed this it would mean that you could probably never buy a house or even a car to get to work.
i can see that this is indeed a vast subject and there are many different opinions. even islamqa (which is normally pretty black and white IMO), allows that:

"does that means that the scholars are agreed on all forms of riba? The answer is no; there is a difference of opinion concerning some forms of it. This is like what we have said about zakaah being obligatory according to consensus, but despite that there is no consensus on every form of it."

http://www.islamqa.com/index.php?ref=22339&ln=eng

by the way - the article on islamqa also raises another intersting question. i was really surprised to read this. it says that:
"The belief that the well-known obligations are obligatory and that the well-known prohibitions are forbidden is one of the most important basic principles of faith, and the one who rejects that is a kaafir according to scholarly consensus."

is that true? i thought it was only a few specific things that took you outside of islam.

Yes it's true - don't you see it says according to the scholarly consensus?

Just before that quote, it said:

If there is consensus that means there can be no doubt regarding the validity of the ruling - it must be true. Therefore is a person rejects a true consensus (the article says obvious) then the person is rejecting something that is 100% from Islam, and this is an act of kufr and takes a person out of Islam, just like how rejecting a verse from the Quran takes a person out of Islam.

This statement explained it better:

I don't know anything about whether it's all types of interest are haram or not, but it is definitely forbidden to work in a bank that deals with interest. Even if you aren't involved with the actual interest, you're still supporting the bank which is doing something haram. It's like a muslim that doesn't drink alcohol working as a bar tender; they're not actually drinking the alcohol, but they are involved in promoting it.

Aamirsaab,

Remember that Yusuf Ali has no formal Islamic education and therefore his commentary contains a lot of errors.

I'm not saying that he was wrong in this instance (I don't know), but just be wary!