Riba (Usury and Interest)

According to Quran and Sunnah


Defining the Problem


Riba (Usury) is of two major kinds:

Riba An-Nasia - Interest on lent money

Riba Al-Fadl - Taking a superior thing of the same kind of goods by giving more of the same kind of goods of inferior quality, eg.,dates of superior quality for dates of inferior quality in great amounts.

The definition of Interest, the literal meaning of interest or Al-Riba as it is used in the arabic language means to excess or increase. In the Islamic terminology interest means effortless profit or that profit which comes free from compensation or that extra earning obtained that is free of exchange. Riba has been described as a loan with the condition that the borrower will return to the lender more than and better than the quantity borrowed.

As muslims, our main concern when it comes to financial transactions is to avoid Riba in any of its forms, despite the fact that the basic foundation of the world economics and finance today is that of riba and dealing in usury.

The Prophet has foretold us of a time when the spread of riba would be so overwhelming that it would be extremely difficult for the muslim to avoid it. This situation calls for muslims to be extra cautious before deciding on what money payment of financial methods to use in any personal or business transaction.

To make sure that we are safe from Riba, we have to learn which transactions lead to it.



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Interest in Pre-Islamic Times



HafizIbn hajr writes in his commentary of Sahih Bukhari (Fathul Bari), Vol. IV p.264:

Imam Malik reports on the authority of Zaid Ibn Aslam that in the period of ignorance (pre-Islamic times) interest was changed according to the following scheme. One person had a right to the property of another person. It may have been a general right because of the amount lent or the price of something purchased or in any other form. A time was set when the claim would be settled.When the appointed time arrived the creditor would ask the debtor if he wanted to settle the claim or pay interest with an extension of time. If the claim was settled then there was no increase in the payment. Otherwise the debtor would increase the amount payable and the creditor would extend the period further.



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Textual Evidence


Hadith - Sahih Bukhari, Volume 3, No. 299; Narrated ‘Aun bin Abu Juhaifah, r.a.

My father bought a slave who practised the profession of cupping, (My father broke the servants instruments of cupping). I asked my father why he had done so. He replied, "The Prophet forbade the acceptance of the price of a dog or blood, and also forbade the profession of tatooing, or getting tatooed and receiving or giving Riba (Usury), and cursed the picture makers."


Hadith - Sahih Bukhari, 2.468, Narrated Samura bin Jundab, r.a.

He speaks of in a dream related to the Prophet (SAW) that there is a river of blood and a man was in it, and another man was standing at its bank with stones in front of him,facing the man standing in the river. Whenever the man in the river wanted to come out , the other one threw a stone in his mouth and caused him to retreat back into his original position.The Prophet was told that these people in this river of blood were people who dealt in Riba (usury).


The Noble Qur'an - Al-Baqarah 275-281

275. 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). So whosoever receives an admonition from his Lord and stops eating Ribâ (usury) shall not be punished for the past; his case is for Allâh (to judge); but whoever returns [to Ribâ (usury)], such are the dwellers of the Fire - they will abide therein.

276. Allâh will destroy Ribâ (usury) and will give increase for Sadaqât (deeds of charity, alms, etc.) And Allâh likes not the disbelievers, sinners.

277. Truly those who believe, and do deeds of righteousness, and perform As-Salât (Iqâmat-as-Salât), and give Zakât, they will have their reward with their Lord. On them shall be no fear, nor shall they grieve.

278. O you who believe! Be afraid of Allâh and give up what remains (due to you) from Ribâ (usury) (from now onward), if you are (really) believers.

279. And if you do not do it, then take a notice of war from Allâh and His Messenger but if you repent, you shall have your capital sums. Deal not unjustly (by asking more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums).

280. And if the debtor is in a hard time (has no money), then grant him time till it is easy for him to repay, but if you remit it by way of charity, that is better for you if you did but know.

281. And be afraid of the Day when you shall be brought back to Allâh. Then every person shall be paid what he earned, and they shall not be dealt with unjustly.


The Noble Qur'an - Al-Imran 3:130

O you who believe! Eat not Ribâ (usury) doubled and multiplied, but fear Allâh that you may be successful.


Hadith - Mishkat-ul-Masabih

The following three ahadith have been taken from Mishkat-ul-Masabih under the section of interest and the English translation has been taken from its English version written by Al Hajj Moulana Fazl Karim (218-227 vol.11)

Hazrat Jabir r.a. has reported that the Messenger of Allah cursed the devourer of usury, its payer, its scribe and its two witnesses. He also said that they were equal (in sin).

Hazrat Abu Hurairah r.a. reported that the Prophet said : A time will certainly come over the people when none will remain who will not devour usury. If he does not devour it, its vapour will overtake him. [Ahmed,Abu Dawood,Nisai,Ibn Majah]

Hazrat Abu Hurairah radiyallahu anhu reported that the Messenger of Allah said: I came across some people in the night in which I was taken to the heavens.Their stomachs were like houses wherein there were serpents,which could be seen from the front of the stomachs. I asked :O Gabriel! Who are these people? He replied these are those who devoured usury. [Ahmed,Ibn Majah]


Hadith - ??

Hazrat Al-Khudri radiyallahu anhu reported that the Prophet said: Gold in exchange for gold, silver in exchange for silver, wheat in exchange for wheat, barley in exchange for barley,dates in exchange for dates, salt in exchange for salt is in the same category and (should be exchanged) hand to hand, so whoever adds or demands increase he has practised usury. The giver and taker are the same.



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Conclusion

After reading the above, it is apparent to us that interest is haram (prohibited). How could anybody even take the time out to think about a matter in which Allah has declared war on the user and his Beloved Prophet has cursed him? As sensible people we can understand that what our Creator has chosen for us is for our own prosperity and benefit.

Islam has encouraged men to earn their own provision and provide for their families. The condition is that the earning has to be according to the Shari’ah. These rules can be found under the heading of trade in the books of jurisprudence. Interest is amongst those conditions which all dealings must be free from.

Imam Abu Hanifah has ruled that if the measurement system (volumetric or in compounds) is the same and the two items are in the same category, then they should be sold in the same amount and direct not in credit otherwise interest will be found.

Imam Shaf’ee says that if the items are valuable and could be considered food then there is the chance of interest.

Imam Malik says that if the items are valuable and are edible then interest is a subject.

http://muttaqun.com/riba.html

I have a question?

Say if the jobs in Banks are based on interest , do you really think a muslim who work's on a bank on a ledger section Or May be in any section earns his money in unlawful manner.

I was thinking about it for a long time since most of our Brother's and sister's who earn never knew whether the money they Earn is Halaal or Haraam.

this thought jus popped out on seeing the following post from one of our moderators.

		Eating from lawful and unlawful sources

If there are certain industries like this Banking industry that invlolve INTEREST,

then please let the Members know about that so that they would be aware of their Earning on the Righteous Way

Working in a riba-based (interest-based) bank

Question:

Aslamoaliakum.

I have been offered a job at a Bank, and I am not sure whether I should work there or not, because the bank makes money from interest (Riba). Please tell me whether working there is allowed (Jaaiz), or not.

jazaakum-Allah-khair.


Answer:

Praise be to Allaah.


You will find the answer in the hadeeth of Jaabir, may Allaah be pleased with him, who said: "The Messenger of Allaah cursed the one who consumes riba (interest or usury), the one who gives it, the one who writes it down and the one who witnesses it. He said: 'All of them are equal in sin.'" (Reported by Muslim, may Allaah have mercy on him, in his Saheeh, no. 1598)

Commenting on this hadeeth, al-Nawawi, may Allaah have mercy on him, said: This is clearly a prohibition of the writing down or witnessing of a contract between the two parties involved in a riba-based deal. It also includes a prohibition of helping others to commit wrong acts. And Allaah knows best.

It is inevitable that the employee in a riba-based bank will play a part in riba dealings one way or another, even if he is just a security guard. Maybe Allaah will help you, my brother, if you are patient, to find halaal employment. (Interpretation of the meaning) "… And whosoever fears Allaah and keeps his duty to Him, He will make a way for him to get out (from every difficulty)." [al-Talaaq 65:2]



Shaykh al-Barraak

Assalamu Alaikkum(warah)

But As in practical wat r the other fields that come under the above mentioned Category.

Can anyone reply me the other Working in a riba-based (interest-based)fields

Other than banking

Salam everyone.

Heres my second thread(and problem)

OK as a fact interest is haram. BUT where does the defintion of interest come from?

I have herd it be said that it is any FIXED return you get on money.

Hence interest from a bank say at 4% is haram. But a bank gives interest as a return on the profit they make from your money and if they make a loss then in the long term the % does change as it does go up or down.

The islam bank has rather just changed the word interest into a ''return on profit'' as far as i can see it is the same as what other banks are doing.

When does interest become haram?

In the Islamic terminology interest means effortless profit or that profit which comes free from compensation or that extra earning obtained that is free of exchange. Hazrat Shah Waliullah Dehlvi a great scholar and leader has given a very concise and precise definition of interest. He says,

"Riba` is a loan with the condition that the borrower will return to the lender more than and better than the quantity borrowed."

http://www.inter-islam.org/Prohibiti...htm#Definition

Check the link for more info on riba Insha'Allah.

JazakAllah khair for the link Lina sis.

Yes, that's how some people justify interest as being halal. But there's no doubt that the profit banks makes come from halal & haram investments. Therefore which ever way we look at it, it's still haram.

I agree. In fact you end up paying them the same amount back as if you'd got a loan/mortgage from a non-islamic bank.

And if you take out a mortage with an Islamic bank, the house belongs to them until the mortgage is paid off. In the mean time you pay 'rent' to live in it.

from this can i say if i send lets say a bank a customer and that customer deposits £100 in the bank and then the bank gives me a % of that money can this be classed as interest?

I am having an exchange with the bank as i am giving them a customer and then i am in turn given a % of the customers money.

anyone have any thoughts on this?

Thanks.

Can any body tell me the references from Quran and Hadis about Interest(SOOD in urdu, and RIBA in arabic)
i need the sura name verse number means exact reference so i can tell one of my fellow that interest is not permitted in islam as he use credit cards and say to me that these cards are not allow to use according to islam
Allah Hafiz
Shuja-ur-Rehman
Pakistan

In suratul Baqarah Aayah 275 it clearly states that Ribaa/ Interest is haraam.

"Allatheena Ya'kuluun ar-ribaa' laa yaquumuun illaa kamaa yaquumul-lathee yatakhab'badahus Shaytaanu minal-mass, Dhaalika bi'annahum qaaluw innamal-bayu' mithlur-ribaa wa ahalallaahul baya'a wa harramar-ribaa' , faman jaa'ahuu maw'idatun min Rabbihii fa'ntahaa lahuu maa salaf wa amruhuu ilalaah, wa man 'aada fa'ulaaki ashaabun naari hum feehaa khaaliduun..."

"Those who eat Riba (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitan (Satan) leading him to insanity. That is because they say: "Trading is only like Riba (usury)," whereas Allah has permitted trading and forbidden Riba (usury). So whosoever receives an admonition from his Lord and stops eating Riba (usury) shall not be punished for the past; his case is for Allah (to judge); but whoever returns [to Riba (usury)], such are the dwellers of the Fire - they will abide therein.

And the in the following ayah (276) it goes onto say:

"Yamhaq-Allaahur- Ribaa' wa yurbis-Sadaqaat wallAllaahu laa yuhibbu kulla Kaffaarin atheem.."

Allah will destroy Riba (usury) and will give increase for Sadaqat (deeds of charity, alms, etc.) And Allah likes not the disbelievers, sinners.

Hope that helps InshaAllah.

I think the verse that should scare us the most about riba (in the interpretation of the meaning) is:

“And if you do not do it, then take a notice of war from Allaah and His Messenger..."

SubhanAllah... What salvation is there for a person upon whom Allah has declared war.

I seek refuge in Allah from that.

Ribaa (Interest)

Written by Dr. Bilal Philips

Monday, 10 July 2006

Article Index
Ribaa (Interest)
Page 2
Page 3

Page 1 of 3
A classical example in these times of impatience and haste leading to Haraam is related to Ribaa. Some Muslims in the West are quick to point out that the whole economic system of western civilization is founded on an interest-based system, and as such necessitates dealing with interest.

They may also add that paying rent year after year with no real return, and residence in unsuitable housing, all make buying a house with a mortgage a must: even if it means taking a bank loan, and or paying monthly installments which include an interest rate. It may also be pointed out by them that dire necessity makes the forbidden allowable, is a well-known principle in Islaamic law, hence the sins one is forced to do are not held against him. This principle can be found in Ibn Abbaas’ report that the Prophet said,

“Allaah has pardoned my people for their inadvertent mistakes, their forgetfulness and for what they were forced to do.” 1

It can also be found in the Qur’aanic verse following the mention of the categories of forbidden meat, wherein Allaah has said,

“But for whoever is forced by hunger (to eat of the forbidden) without desiring sin, verily Allaah is forgiving and merciful.” (Qur’an 5:3)

However, the point is, what is meant by the word “forced” and how is dire necessity defined? Does it refer to circumstances under which one desires something badly and is driven by that desire to believe that he or she cannot live without it? Or is it only applicable to circumstances in which one is threatened with loss of life or limb? Does it mean when one’s life is in danger? The case usually cited to illustrate what is meant by forced is that of Ibn Yaasir,

The Sahaabee who accepted Islaam as a slave and was tortured to the point of death to renounce his belief. He complied with his master’s demand and falsely admitted that the Prophet was a magician and that the Makkan idols were his gods. After being released from torture, Ammaar Ibn Yaasir avoided the Prophet’s company out of shame for what had said; especially since both his father, Yaasir, and his mother, Sumayyah, chose to be tortured to death rather than deny their belief in Allaah and His Prophet. When the Prophet learned of Ammaar’s feelings of shame, he called for him and asked him about the state of his heart. Ammaar replied that it was full of Eemaan (belief), so the Prophet said, “If they repeat the torture repeat what you said.”

Then Allaah revealed the following verse,

“Whoever disbelieves in Allaah after believing, except he who is forced though his heart is at peace with Eemaan; Allaah is angry with whoever finds ease in disbelief and they will have a severe penalty.” 2,3

This Hadeeth clearly illustrates the true meaning of being “forced” and “dire necessity” as understood by the Sharee’ah; circumstances in which one may incur the loss of life or limb. Only in situations in which one’s life or limb is actually threatened can be considered the type of necessity which would make certain Haraam practices permissible.

Whenever western colonial powers wanted to introduce offensive practices in colonized Muslim lands, they would first gain control of a promising Muslim scholar and then coerce him into making Fatwaas (legal rulings) in their favor. Thus, Ribaa (which was unthinkable among Muslims less than a hundred years ago) found its way into the ranks of Muslims through the Fatwaas of the likes of Muhammad Abduh, who was installed by the British as Shaykh al-Azhaar (Chancellor of al-Azhaar University in Egypt) against the will of its staff. Under the influence of these Fatwaas, Abdullah Yusuf Ali stated in his commentary on the verses on Ribaa that the prohibition did not include “economic credit, the creature of modern banking and finance.” However, serious unbiased consideration of the main Qur’aanic verses on Ribaa found at the end of Soorah al-Baqarah and the severe warnings of the last Prophet indicate an unconditional opposition to Ribaa in all of its forms.

In verse 275 of Soorah al-Baqarah, Allaah starts off a frontal attack on Ribaa describing those who take interest in the most repulsive terms:

“Those who devour interest stand up like someone lurching from Satan’s touch.” 4

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Last Updated ( Tuesday, 08 August 2006 )
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I was listening to an interview of Dr. Zakir Naik( well, it was a Question Answer session) and he said that the workers in a riba-based bank earn haraam money.
Nowadays, there are some riba- free banks too in some islamic countries.......thats what they call islamic banking. May be you can find one in your country inshaAllah.

Salaam to all. I have much trouble in working this one out for myself. I have been to talks about it have herd it been debated many times. But i am still none the wiser.

What does ilsam forbid is it interest or is it usury? From translations of the Qur’an that i have seen the word Riba is translated directly into usury which is not the same as interest...

Can anyone shed some light on the issue for me please?

Thank you.