Intrest(Riba) in Quran and Sunnah
Thursday 27 August, 2009 by Afroz
In Shariah "Riba" is a term that is used when two parties exchange item of same kind, and in return one party received extra (or in excess) of what he gave. A simple example is when gives 100 units of Gold and received 120 units of Gold in return. The extra or excess 20 units are considered "Riba".
The most common application of Riba is on monetary transaction relating to "loans" and "credits". A simple example of loan is when Lender gives $1000 to a Debtor with an agreement that Debtor will return $1200 on specified date. Hence, the Lender will receive extra $200 (either as his service fee, rent, income, or reward for lending money for stated time period). This extra $200 is absolute form of Riba in Islamic Shariah.
Similarly, other financial transactions involving Riba, such as advancing money on interest, keeping deposits in a bank for the sake of earning interest, or getting concessions in rates of goods or commodities against advance payments of price, mortgaging and utilizing an income-yielding property against a certain sum, to be returned in full when the property is redeemed and investing money in a trade against a predetermined and fixed rate of profit-are all forbidden transactions because they involve Riba in some form or the other. And the person doing any of these transactions invariably pay X amount of money, but in return gets X+more back (without profit and loss sharing).
INTREST IN QURAN:
Those who devour usury will not stand except as stands one whom the Evil One by his touch hath driven to madness. That is because they say: "Trade is like usury," but Allah hath permitted trade and forbidden usury. Those who after receiving direction from their Lord, desist, shall be pardoned for the past; their case is for Allah (to judge); but those who repeat (the offence) are Companions of the Fire; they will abide therein (forever). (Al-Baqarah:275)
Allah will deprive usury of all blessing, but will give increase for deeds of charity; for He loveth not creatures ungrateful and wicked. (Al-Baqarah:276)
O ye who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers. (Al-Baqarah:278)
O you who have believed, do not consume usury, doubled and multiplied, but fear Allah that you may be successful. (Al-Imran:130)
That which ye lay out for increase through the property of (other) people, will have no increase with Allah: but that which ye lay out for charity, seeking the Countenance of Allah, (will increase): it is these who will get a recompense multiplied. (Ar-Rum:39)
Punishment for Riba (Intrest) eaters
Allah will deprive usury of all blessing, but will give increase for deeds of charity; for He loveth not creatures ungrateful and wicked. (Al-Baqarah:276)
If ye do it not, take notice of war from Allah and His Messenger: but if ye turn back, ye shall have your capital sums; deal not unjustly, and ye shall not be dealt with unjustly. (Al-Baqarah:279)
Bukhari :: Book 3 :: Volume 34 :: Hadith 298
Narrated Samura bin Jundab: The Prophet said, "This night I dreamt that two men came and took me to a Holy land whence we proceeded on till we reached a river of blood, where a man was standing, and on its bank was standing another man with stones in his hands. The man in the middle of the river tried to come out, but the other threw a stone in his mouth and forced him to go back to his original place. So, whenever he tried to come out, the other man would throw a stone in his mouth and force him to go back to his former place. I asked, 'Who is this?' I was told, 'The person in the river was a Riba-eater."
Click Here to download entire document on Riba in Islam
The most common application of Riba is on monetary transaction relating to "loans" and "credits". A simple example of loan is when Lender gives $1000 to a Debtor with an agreement that Debtor will return $1200 on specified date. Hence, the Lender will receive extra $200 (either as his service fee, rent, income, or reward for lending money for stated time period). This extra $200 is absolute form of Riba in Islamic Shariah.
Similarly, other financial transactions involving Riba, such as advancing money on interest, keeping deposits in a bank for the sake of earning interest, or getting concessions in rates of goods or commodities against advance payments of price, mortgaging and utilizing an income-yielding property against a certain sum, to be returned in full when the property is redeemed and investing money in a trade against a predetermined and fixed rate of profit-are all forbidden transactions because they involve Riba in some form or the other. And the person doing any of these transactions invariably pay X amount of money, but in return gets X+more back (without profit and loss sharing).
INTREST IN QURAN:
Those who devour usury will not stand except as stands one whom the Evil One by his touch hath driven to madness. That is because they say: "Trade is like usury," but Allah hath permitted trade and forbidden usury. Those who after receiving direction from their Lord, desist, shall be pardoned for the past; their case is for Allah (to judge); but those who repeat (the offence) are Companions of the Fire; they will abide therein (forever). (Al-Baqarah:275)
Allah will deprive usury of all blessing, but will give increase for deeds of charity; for He loveth not creatures ungrateful and wicked. (Al-Baqarah:276)
O ye who believe! Fear Allah, and give up what remains of your demand for usury, if ye are indeed believers. (Al-Baqarah:278)
O you who have believed, do not consume usury, doubled and multiplied, but fear Allah that you may be successful. (Al-Imran:130)
That which ye lay out for increase through the property of (other) people, will have no increase with Allah: but that which ye lay out for charity, seeking the Countenance of Allah, (will increase): it is these who will get a recompense multiplied. (Ar-Rum:39)
Punishment for Riba (Intrest) eaters
Allah will deprive usury of all blessing, but will give increase for deeds of charity; for He loveth not creatures ungrateful and wicked. (Al-Baqarah:276)
If ye do it not, take notice of war from Allah and His Messenger: but if ye turn back, ye shall have your capital sums; deal not unjustly, and ye shall not be dealt with unjustly. (Al-Baqarah:279)
Bukhari :: Book 3 :: Volume 34 :: Hadith 298
Narrated Samura bin Jundab: The Prophet said, "This night I dreamt that two men came and took me to a Holy land whence we proceeded on till we reached a river of blood, where a man was standing, and on its bank was standing another man with stones in his hands. The man in the middle of the river tried to come out, but the other threw a stone in his mouth and forced him to go back to his original place. So, whenever he tried to come out, the other man would throw a stone in his mouth and force him to go back to his former place. I asked, 'Who is this?' I was told, 'The person in the river was a Riba-eater."
Click Here to download entire document on Riba in Islam
