Friday feature: Riba, the forbidden fruit
By Sidrah Unis
ISLAM, the last of the Abrahamic religions, preached by Holy Prophet Muhammad (PBUH), lays stress on the complexities of human relationship which are governed by contractual obligations, social norms, cultural affiliations, and most importantly, economics.
According to Islamic perspective, all wealth belongs to God Almighty: “And to Allah belongs all that is in the heavens and all that is in the earth…” (3: 109) “Believe in Allah and His Messenger, and spend of that whereof He has made you trustees.” (57:7)
Market mechanism is indeed an integral part of the Islamic economic system as the very existence of private property is dependent on the former. But profit, a strong motivating factor in free enterprise, if not controlled, may overpower the basic norms of social and economic justice prevailing in Islamic public and social order. The underlying principle operating in Islamic market law is twofold: individual autonomy to own productive resources to further one’s economic interest and protecting the consumer from harm.
Individual interest has to be so pursued that collective interest of society is not put at risk. Thus any individual business undertaken to cause harm to the fabric of society has been strictly prohibited. In short, the basic principles of Islamic economic system are that moral values are the guiding factors for all economic activities; there should be maximum utilisation of human and material resources, the same to be managed equitably; wealth should be distributed and circulated fairly, and last but not least, prohibition of riba.
Riba literally means ‘increase’. In Shariah, it is an addition over and above the principal amount i.e. paying money for the use of money. Prior to the emergence of Islamic faith, over fourteen hundred years ago, almost all religions of the world prohibited money lending as the same was conducive to earning of profit on the sum lent. Biblical provisions such as “…take thou no usury of him or increase: but fear thy God…” (lev. 25-36) and, “…that hath taken off his “hands from the poor that hath not received usury nor increase, hath executed my judgment, hath walked in my statutes, he shall not die for the inequity of his father, he shall surely live” (Ezekiel 18:7) depict the same.
Aristotle, the famous Greek philosopher, declared money as sterile, which he compared to a barren hen and so rejected the very concept of interest, for to him the sole purpose of money was to facilitate exchange and not to beget greater sum of money. Acquisition of profit and income through money lending was prohibited in the Roman Empire as well.
The Holy Quran, which is an undisputed source of Islamic law and the Sunnah of the Holy Prophet expressly prohibit riba. “And that which you give in gift (to others), in order that it may increase (your wealth by expecting to get a better one in return) from other people’s property has no increase with Allah…” (30:39) “O you who believe! Eat not riba doubled and multiplied, but fear Allah that you may be successful.” (3: 130) “Those who eat riba will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitan (Satan) leading him to insanity…” (2:275) “…Be afraid of Allah and give up what remains (due to you) from riba (from now onward), if you are (really) believers.” (2:278)
Abu Hurairah narrated that the Holy Prophet once said: “On the night of Ascension I came upon people whose stomachs were like houses with snakes visible from the outside. I asked Gabriel who they were. He replied that they were people who received riba.”
On another occasion, according to Abu Hurairah, the Holy Prophet said “There will certainly come a time for mankind when everyone will take riba and if he does not do so, its dust will reach him.” Ibn Masud narrates that the Prophet once said: “Even when riba is much, it is bound to end up into paltriness.”
According to Anas Ibn Malik the Holy Prophet once stated: “When one of you grants a loan and the borrower offers him a dish, he should not accept it; and if the borrower offers a ride on an animal, he should not ride, unless the two of them have been previously accustomed to exchanging such favours mutually.” The Holy Prophet in his last sermon told the people: “Every form of interest (riba) is cancelled; capital indeed is yours which you shall have; wrong not and you shall not be wronged. Allah has given His Commandment totally prohibiting riba. I start with the amount of riba which people owe to Abbas and declare it all cancelled.”
Broadly categorised, riba is of two kinds: riba al-Nasi’a and riba al-Fadl; the former refers to interest on loans which has been duly mentioned in the Holy Quran (see 2: 279, 2: 280). Riba literally means ‘increase’ and nasi’a means ‘delay’. Therefore it means the profit which is acquired in case of delay in repayment of money. Riba al-Fadl is the excess measured in terms of weight, value or counting.
Abu Sa’id al-Khudri relates on his authority that the Holy Prophet once said that gold must be exchanged for gold, like for like, from hand to hand. Any increase, fadl, in one commodity over the other is riba. Silver must be exchanged for silver, like for like, from hand to hand, and any increase is riba. Salt be exchanged for salt, like for like, from hand to hand, any increase is riba.
Barley be exchanged for barley, like for like, from hand to hand, any increase is riba. Riba al-Fadl pertains to any form of exploitation or unlawful gain accruing through business transactions. Thus, whereas riba al-Nasi’a deals with increase earned on money itself, riba al-Fadl incorporates all other forms of unfair material advantage which any one party may have over the other.
It must be taken into consideration that riba was condemned even during the jahaliyah period i.e. Arabia before the advent of Islam. In A.D. 605, before the advent of Islam, the curtains of the Holy Kaaba caught fire and the house of Allah incurred severe damages. In order to reconstruct the same, contributions were sought from the general public but only honestly earned money was accepted, while prostitutes and people practising usury were barred from contributing. Thus even the pagans of Arabia considered usury to be an immoral and dishonest practice.
Socio-economic justice is indispensable to an ideal Muslim society, where a balance has to be maintained between individual interests and collective welfare; where incentive should not be mingled with or converted into greed causing injustice to others.

