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PROHIBITION OF RIBA

Muhammad Samiullah      

Riba is prohibited in Islam in all its forms whatever its rate may be. It should be remembered that the word Rbia, which means an excess or addition over and above the principal, covers both usury and interest. (According to Islamic Jurists, usury means interest on non-productive loan and interest means an excess or addition on productive loan.) In fact, every sum stipulated to be received or given over and above what one advances or receives as a loan is usury or interest, whether the dealing is with an individual, or with a bank, or with any other organisation. Interest is not confined to money but to all kinds of commodities in which there is an idea of stipulated increase when taken or given in loan. It also includes an excess according to the legal standard of measurement and weight in one of the two homogeneous articles in which such an excess is stipulated as an obligatory payment on one of the contracting parties.

Interest which is the basis of modern capitalism is the very opposite of Zakaah. Zakaah causes wealth to flow from the rich to the poor, while interest takes away wealth from the poor and hands it over to the rich. Islam prohibits all transactions involving interest. Interest is neither trade nor profit. It is a means of exploitation and concentration of wealth. The Holy Quraan warns

O ye who believe! Devour not usury, doubling and quadrupling (the sum lent). Observe your duty to Allah, that ye may be successful. (3: 130)

O ye who believe! Observe fear of Allah, and give up what remaineth (due to you) from usury, if ye are believers. An if ye do not, then be warned of war (against you) from Allah and His Messenger. And if ye repent, then ye have your principal (without interest). Wrong not, and ye shall not be wronged. (2: 278,279)

The question naturally arises as to why Islam has prohibited interest with such force and stress. The answer is that this foul transaction is born of a depraved mentality and it gives rise to many moral, social and economic evils. It makes a man avaricious of wealth, selfish and greedy; it inculcates in him a sense of insecurity and thus undermines his belief in Allah as the Sustainer. It drives away from the heart of a person the feeling of human brotherhood and converts him into a Shylock always insisting on his pound of flesh, no matter how distressed his fellow being may be.

Usury was very common in the Arab society. The Holy Prophet (SallAllaho alaihe wasallam), in accordance with the Divine Command, cancelled all the dues of his uncle, Hadhart Abbas, which fell under this head. He told in very explicit terms on the occasion of his Farewell Pilgrimage: Usury is forbidden but you will be entitled to recover your principal. Do not wrong and you shall not be wronged. Allah has decreed that there should be no usury and I am making a beginning by remitting the amount of interest which Abbas bin Abd al Muttalib has to receive. Verily it is remitted in its entirety.

The Quraan recognises trade and commerce not only as a lawful profession but as morally praise-worthy. It lays down in explicit terms:

Allah permitteth trading and forbiddeth interest. (Surah al Baqarah: 275)

Verses to the same effect are to be found in several other places. The following Verses have the same import and are more lucid:

O ye who believe! When the call is heard for the Salaah (Prayers) of the day of Jumuah (Friday), hasten unto remembrance of Allah and leave your trading (Bai). That is better for you if you did but know. And when the Salaah is ended, then disperse in the land and seek of Allahs bounty... . (62: 9,10)

The Holy Prophet (SallAllaho alaihe wasallam) has further made this explicit. He says: To exert oneself for earning lawful income is Jihad. He persuaded his followers to search for the hidden resources of livelihood. The Holy Prophet (SallAllaho alaihe wasallam) is reported to have said: If one seeks a living for his family, it is in the way of Allah; if he does it for his aged parents, it is in the way of Allah; and if he does it for ostentation and out of pride, it is in the way of Shaitaan.

Islam as such has not permitted Muslims to earn their living by foul means and by hook or crook. It has imposed certain restrictions on the sources of earning. These restrictions too have a healthy effect on the economic life as a whole and provide encouragement to commercial activity. All practices that do not result in free and fair exchange of goods and services are disallowed. The Quraan holds the following prohibited:
(1) Bribery (2:188)
(2) Misappropriation and embezzlement (2:188)
(3) Breach of trust (3:161)
(4) Stealing (5:38)
(5) Under-weighing or under-measuring (83:3)
(6) All practices that cause indecency and obscenity (7:33 & 24:19)
(7) Income arising out of prostitution, debauchery or the like (24:2 & 33)
(8) Satanic inspired Destitution & Lewdness (2:268)
(9) Distillation, sale and transport of liquors (5:90)
(10) All games of chance, for example, betting on horses, lottery and gambling (5:90)
(11) All services relating to idols (5:90)
(12) Fortune telling, and soothsaying (5:90)
(13) Interest (2 : 275-280 & 3 : 130).

The above mentioned trades and professions are also condemned by the Holy Prophet (SallAllaho alaihe wasallam): There are eight condemnable items, namely, Bribery to the Imaam (high officials), which is the worst type, price of dog, insemination charges of an animal, income of a prostitute, cupping charges, tips (or presents) for the fortune teller and riba (interest).

Besides the above unlawful sale / purchase transactions, there are other forms of sales too which the Holy Prophet (SallAllaho alaihe wasallam) did not like, e.g. fictitious tender of a high price anticipation of fluctuations in the market, undue publicity of products, etc.)

In short, all devices of deceit and dishonesty in business are prohibited by Islam. Such acts are held to be condemnable without reserve or qualification. On the other hand, the trader who plies his trade fairly and honestly will be in the company of Prophets, saints and martyrs on the Day of Judgment.

Modern economics is so inter-linked with interest that many people think that it is impossible to do away with interest. The situation is really very complex. But we must aim at getting rid of interest. A Muslim state must endeavour to change the present system, but this requires careful and systematic planning. Allah has not imposed on us something impossible. An interest free economy will be a boon to all the peoples of the world.

Interest is a monstrous evil. In the social sector, it produces a class of indolent persons who live on the sweat and labour of other persons without sharing their woes and worries. In the field of economics, it gives rise to depressions and trade cycles which do incalculable harm to the whole structure of economy producing disastrous results in the form of mass unemployment and contraction in the volume of investment.

Interest leads to the concentration of wealth in a few hands, giving rise to vast disparities of income in the different classes of society and, thus leading to class conflicts and other evils so commonly seen in the modern world. On the moral side, it dehumanizes persons and makes them purely economic animals who weigh and assess everything from the point of view of material gain.

Hadhrat Abu Hurairah reported Allah;s Messenger (SallAllaho alaihe wasallam) as saying, The slave of the Dinaar (a currency of his time), the slave of the Dirham (another currency of his time), and the slave of the bordered silk cloak are wretched. If such a one is given anything, he is pleased, but if not, he is displeased, wretched and disappointed and when he is pierced with thorns, he cannot be extracted (i.e. when affliction comes to him, he finds no comfort and can do nothing to avert it.) (Bukhari)

He reported further the Holy Prophet (SallAllaho alaihe wasallam) as saying: Cursed be the slave of the Dinaar and cursed be the slave of Dirham. (Tirmizi)

The Holy Prophet (SallAllaho alaihe wasallam) is reported to have said Two hungry wolves let loose among sheep are not more destructive to them than a mans greed for property and self-esteem are to his religion. (Tirmizi & Darimi)

Man needs bread to live but he does not live on bread alone. This means that earning and spending money is essential for our living, but we do not live only for this. We have a greater purpose in life. We are Allahs vicegerent (Khalifah) on the earth. We not only have a body but we have a soul also and a conscience as well. Without soul and conscience, we would be considered little more than animals.

Everything in Islam is for the benefit and welfare of mankind. The economic principles of Islam aim at establishing a just society wherein every one will behave responsibly and honestly and not as cunning foxes fighting to get a big share of something as possible without regard to honesty, truth, decency, trust and responsibility.

It is generally argued that the person who invests capital should also be entitled to his share in profit. Islam agrees with it, and that is why it has encouraged the conduct of business on the basis of Mudaarabah and Mushaarakah, but it has taken measures to ensure that when a capitalist is entitled to his share in case of profit, he should also be prepared to share the burden of loss, in case the business suffers loss. There is no concept of guaranteed profit in Islam.

The modern researches in economics have falsified all those theories in which a capitalist is depicted as the most self-sacrificing person who is kind enough to supply capital to trade and industry by making monetary sacrifices. The economists have made it clear that it is not out of self-abstinence that one piles up wealth, but because his wealth will be left idle and dwindling in value, if he does not lend it to others and demand from them a guaranteed increase in it.

The reasonable course for him would be that he should give to the unfortunate members of society, whatever is left with him as his surplus wealth, but if he cannot afford to do so, he should at least give it to others as a loan so that needy persons may be able to earn their livelihood through his help and, if he is not prepared to do even this, he should enter into business partnership with others and share the profit or bear the loss resulting there from.

This practice of devouring interest is the practice of disbelievers and it is a war against Allah and the Holy Prophet (SallAllaho alaihe wasallam) as we have been told in Verse 279 of Surah al Baqarah. It is an ultimatum given to those who insist on taking interest after its prohibition. Banu Mughirah, a tribe, were famous money lenders in Arabia. After the conquest of Makkah, the Holy Prophet (SallAllaho alaihe wasallam) wrote to his Aamil (in-charge of affairs) to declare all the sum due to them on account of Riba as unlawful and to wage war against them, if they persisted in their demand for the same.

Riba, as at present, was the mainstay of the rich in the pre-Islamic Arab Society with all its attendant evils. There was:
- Love of money as against love for ones fellowmen
- Lure of idle life with its despicable pursuits
- Exploitation and oppression of the needy by the wealthy
- Crooked and corrupt way of life
- Ceaseless unrest due to greed, envy and malice

Almighty Allah has asked us to get rid of these evils when sent down the injunction:

Allah hath blighted usury and made almsgiving fruitful. Allah loveth not the impious and guilty. (2:276)

Moreover, the self-assumed argument that trade is exactly like usury was also blown to pieces by the Quraanic declaration that:

Allah has permitted trade and forbidden usury. (2:275)

Allah has simply declared trade lawful and interest unlawful, thus making it obligatory for Muslims to abide by the commandment. This is the easiest solution of the problem which, on the one hand, eliminates many evils of the Capitalist economy and, on the other, leaves no need for the adoption of the tyrannical and unnatural system of Socialism. The French Orientalist Louis Massignon has said:

In this conflict between Capitalism and Socialism only that culture can be assured of a secure and bright future which not only prohibits interest but also makes people abide by this prohibition.

As a result of the Divine Command and Prophetic instructions, a weeping change came over the Arab society. It no longer sucked the blood of the poor but ran to them to provide them relief by remitting the dues that had accumulated by way of interest, because they were asked to give up what remained of their demand for usury . (2:278)

The Quraanic ban applies to usury in all its forms and workings. The Holy Prophet Muhammad (SallAllaho alaihe wasallam) had the evil practice eradicated where there existed even the slightest semblance of it; namely forward trading in grain before it actually arrived in the market for sale, buying goods from a market though the middleman in time of famine, exchanging standing crops against what has been harvested, exchanging fruit on trees for fruit in baskets and taking a fixed amount of grain from the produce of land given on lease, even if there is a mutual agreement therefor.

The question of free choice and Mutual consent or agreement of parties concerned does not really matter. In Islam, the mutual consent of two parties does not always justify a certain transaction or agreement. If a woman is willing to be criminally assaulted, this fact would not absolve the assaulter of his crime. Even in the case of fornication, which the West, in its short sightedness, considers to be a private affair of the individual and the mutual consent of the parties, cannot absolve the criminals of their guilt.

The Holy Prophet (SallAllaho alaihe wasallam) has forcefully condemned interest.

(1) Hadhrat Jaabir said that the Prophet (SallAllaho alaihe wasallam) cursed the one who accepted usury, the one who paid it, the one who recorded it. and the two witnesses to it, saying they were all alike. (Muslim)

(2) Hadhrat Ibne Masood reported Allahs Messenger (SallAllaho alaihe wasallam) as saying Even though usury be not of much amount, in the end it leads to penury. (Ibne Maajah & Baihaqi)

(3) Hadhrat Abdullah Ibne Hanzalah reported the Prophet (SallAllaho alaihe wasallam) as saying: A Dirham which a man knowingly receives in usury is a far more serious crime than thirty six acts of fornication. (Ahmad & Darqutni)

(4) Hadhrat Abu Hurairah reported the Prophet (SallAllaho alaihe wasallam): Usury has seventy evils, the least serious being that a man should have sexual intercourse with his mother. (Ibne Maajah)

(5) When adultery and usury become prevalent in any place, it becomes fit (or right place) for Allahs chastisement which can descend any time on the people of that area. (Haakim)

In view of the gravity of this crime (i.e. taking or giving of interest), we should try by all means to refrain from usurious transactions.

In regard to the specific question to how Muslims living in the non-Muslim countries (where they happen to be in minority) can avoid insurance and interest-bearing transactions.

The answer is, where there is a will, there is a way. Wherever Muslims are in a sizeable number in any non-Muslim country whether in Europe, America or South East-Asia, they should try to pool their resources and form some sort of cooperative society or financial institution to conduct their business and other activities free from the scourge of interest. However, this would require patience, deliberation and hard work but with hardship goes the ease, proclaims Al-Quraan (95 5-6).

It hardly needs to be emphasized that in Islam no obedience is due to anyone, if it involves disobedience to the commands of Allah revealed through His last Messenger as enshrined in the Quraan and the Hadeeth. Allah proclaims in the Quraan To help believers is incumbent on Us. (30:47). So we should try first and foremost to be true believers so as to win Allahs favour and support. If Allah is your helper none can overcome you, and if He withdraws His help from you, who is there who can help you? In Allah let believers put their trust. (3:160)
Due partly to these Quraanic injunctions coupled with the teachings and life-example of the Holy Prophet (SallAllaho alaihe wasallam) and partly due to the initiative and enterprising spirit of early Muslims, trade and commerce flourished in the then Islamic Empire side by side with the non-existence of the evil of interest. During this period, the trade activities of Muslims won the admiration of the whole world. Muslim caravans and ships traversed almost all lands and waters. However, later on, the Muslims lost their dominance because of their slackness and selfishness and because they abandoned the moral principles enunciated by Islam in the sphere of business and trade. Hence, followed a great decline in business activity resulting in serious loss of fortunes. The Muslims can surely regain their former position if they shun Riba, stop profiteering, hoarding and adulteration, introduce quality control and other checks and balances required by the Shariah. Islam is a complete code of life, and its comprehensive teachings encompass all the branches of life. The Quraan commands: O ye who believe! Enter into Islam completely; and follow not the footsteps of the devil. Lo! He is an open enemy for you. (2:208)

May Allah enable us to conduct our business, trade, commerce, agriculture, industry and other activities in accordance with the teachings and precepts of Islam; for therein lies our lasting prosperity. Ameen!

It would be in the interest of all the Muslims States and their people to try earnestly and immediately to take a bold step for putting an end to Riba which is eating into the vitals of their nationhood, freedom and independence. Let prejudice not stand in their way. Prudence should be their guide. It is for their benefit to give up living off the interest. May Allah show us Light and give us the determination to follow His Guidance for the greatest good of the greatest number of people. Ameen!

Verily there cometh unto you from Me a guidance; and whoso followeth My guidance, there shall no fear come upon them, neither shall they grieve. But they who disbelieve and deny Our revelations, such are rightful owners of the Fire. They will abide therein. (2:38-39)

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