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By Afzal Roomy Faizur Rehman Ahmed Faraz Tehsin Ovais Ahmed
. Musharakah etc. To achieve this we will start by providing a more general meaning of riba and then follow it up by the views of our jurist. To understand the concept Islamic banking system and especially insurance. For the modern Jurist we have chosen Rashid Reda who was a student of Shaykh Muhammad Abduh and whose work is the basis for most new modernistic scholars. In the end we will conclude by summarising the similarities and differences between the two jurists. This article is intended to provide a guide and it is upto the reader to make his or her view on this subject of riba. We have selected Abu Bakr al-Jassas as the early jurist whose book Ahkam al Quran has been a guide for all who have followed him. Interest or riba. concept of riba should be clear. yet in almost every Muslim country this is the dominant part of their financial structure. is prohibited in Islam. In recent decades there has been a shift toward Islamic financial system not only in Islamic countries but also in the western world. We have also chosen Dr Khalid Zaheer as a modern day economist and his views on riba. which creates hardships and inequalities.Introduction Interest based system is the most prevalent financial system in the world. Islamic finance is free of Riba and offers many products such as Mudarabah. This article will put forward views on riba by modern jurist and also that of early jurist. Ijara.
earnings from prostitution. in Surah Ar-Rum. Moreover different economists defines interest byheir differnet views like J.What is Riba The modern secular economic system interest plays a vital role whole over the world. But from the religious point of view. a Makkan Surah wherein the term riba finds mention in the following words: "And whatever riba you give so that it may increase in the wealth of the people. Christianity. Abu Saud who was the member of Islamic Foundation Leicester UK defines interest as " the excess of money paid by the borrower to the lender over and above the principle for the use of the lender's liquid money over a certain period of time" ." (Ar-Rum 30:39) y The second verse is of Surah Al-Nisaa where the term riba is used in the context of sinful acts of the Jews in the following words: . Out of all these Riba is one of the legal role practising in all the countries. interest has been a deductable subject among economic and political theorists. Maisir (Gambling). Islam prohibited few earnings that includes Riba (Interest) . alcohol. except some Muslim countries especially some Western world people cannot think of any economic system withoud interest. drugs and other similar earnings. All the sources of Islamic law strictly condemned riba. all the major religions (Islam. The Holy Quran and Hadith of Prophet (PBUH) says about riba in various places and situations which quoted below:- (Quranic verses and its translations) y First. Gharar (Uncertainity) . pork. In fact. it does not increase with Allah. Hindu) riba (Interest) is purely prohibited and from the theoritical standpoint.M Keynes did not define interest but mentioned the rate of interest as "The percentage of excess of a sum of units of money contracted for forward units of time over the spot or cash price of the sum thus contracted for forward delivary". Judaisam.
" (An-Nisaa 4:161) y In the third verse of Surah Al-i-'Imran the prohibition of riba is laid down in the following words: "O those who believe do not eat up riba doubled and redoubled. And Allah has permitted trading and prohibited riba. So. he is ."And because of their charging riba while they were prohibited from it. whoever receives an advice from his Lord and stops. That is because they have said: 'Trading is but like riba'." (Al-i-'Imran 3:130) y The following set of verses is found in the Surah Al-Baqarah in the following words: "Those who take interest will not stand but as stands whom the demon has driven crazy by his touch.
Vol. if you really know. and there is no fear for them. in al-Bukhari. then deferment till ease. establish Salah and pay Zakah. nor be wronged. Number 282: Narrated 'Aisha: The Prophet purchased food grains from a Jew on credit and mortgaged his iron armor to him. Sahih al ± Bukhari. Book 41. And that you leave it as alms is far better for you. And if you repent. And the ones who revert back. peace be on him. Neither you wrong. 309 the hadith is narrated with nasi¶ah. . those are the people of Fire. Allah destroys riba and nourishes charities. have their reward with their Lord. And Allah does not like any sinful disbeliever. what he has earned. O those who believe. said: "There is no riba except in nasi'ah (waiting). Bab Bay al-dinari bi al-dinar nasa'an. instead of ajal) Sahih al-Bukhari. (Mis'ar thinks that Jabir went in the forenoon. also in Nasa'i). in full." (Bukhari. fear Allah and give up what still remains of the riba if you are believers. Volume 3.allowed what has passed. There they remain for ever. then everybody shall be paid. nor shall they grieve. 3. (Hadiths-sayings of Prophet): From Usamah ibn Zayd: The Prophet.) After the Prophet told me to pray two Rakat. Muslim and Musnad Ahmad) "There is no riba in hand-to-hand ³spot transactions. Kitab al-Buyu. And be fearful of a day when you shall be returned to Allah. Kitab al-Musaqat. yours is your principal. But if you do not. then listen to the declaration of war from Allah and His Messenger." (Al-Baqarah 2:275-281). Surely those who believe and do good deeds. Volume 3.Nuber 579: Narrated Jabir bin Abdullah: I went to the Prophet while he was in the Mosque." (Muslim. And if there be one in misery. and his matter is up to Allah. Bab bay'i al-ta'ami mithlan bi mithlin. And they shall not be wronged. Book 34. (ishtara ta'aman min yahudi ila ajalin wa rahnahu dir'an min hadid. he repaid me the debt he owed me and gave me an extra amount.
However. also in Muslim and Musnad Ahmad. y Narrated Usamah bin Zaid: The prophet PBUH said:´ There is no riba except in nasiah´. ³Kitab al Buyu´. . But it is important to note that. he should not accept it. y Narrated Anas bin Malik: The prophet PBUH said:¶When one of you grants a loan and the borrower offers him a dish. The prohibition of Riba Al Nasiah essentially implies that fixing the rate of return on loan in advance and waiting for the positive incerement of the loan and the reward for the waiting is prohibited in Shariah. However. In this sense. In this sense. the term riba has been used in the Quran verse 2:275 which states that " God has allowed trade and forbidden riba (Interest). riba has the same meaning and import as interest. the waiting involved in the repayment of loan does not by itself justify a positive reward. The predetermined positiveness of rate of return should be the question that points. it is not mean every increase or growth which has been prohibited by Islam. it is necessary to determine the term "Riba" and what its really stands for. defer or wait and refers to the time allowed to the borrower to repay the loan with "addition" or "premium". Hence Riba Al Nasiah is equivalent to the interest charged on loans. The first is Riba-Al-Fadl and the second is Riba-Al. Riba is an Arabic word literally means increase. riba technically refers to "premium" that must be paid by the borrower to the lencer along with the principal amount as a condition for the loan or for an extension in its maturity. according to the shariah.Nasiah Riba Al Nasiah The term "nasiah" comes from the root "nas'a" which means to postpone. he should not ride. unless two of them have been previously accustomed to exchanging such favours mutually´ Ref: Bukhari. It makes no difference either the rate of return or fixed or variable amount of principal. and if the borrower offers a ride on a animal.The Meaning of RIBA After knowing the sevre verdict of Quran and Sunnah against riba. In Shariah. the term riba in Shariah used in two senses. addition or growth. Riba Al Fadl.
He took the gold pieces in his hands and fidgeted with them. for Allah¶s Apostle said: µThe selling of gold for gold is Riba except if the exchange is from hand to hand and equal in amount.. it has not allowed everything in trade. then that is exactly Riba¶. except that the exchange be spot. y Narrated Umar: The Prophet said.¶ (ibid. Because by the perspective of legel maxims of Islamic jurisprudence anything which serves the means of unlawful is also unlawful. 2026) y Narrated Ibn Shihab that Malik Ibn Aws said: µI was in need of change for onehundred Dinars. the selling of wheat for wheat is Riba unless it is from hand to hand and equal in amount. barley for barley and dates for dates. 208) . the result would be no different. and dates for dates.¶ µUmar was listening to that and said: µBy Allah! You should not separate from Talhah till you get the money from him. Similarly the selling of barley for barley is Riba except if it is from hand to hand and equal in amount. and the selling of barley for barley is Riba unless it is from hand to hand and equal in amount.While Islam allowed interest on loans and allowed trade. and dates for dates is Riba except if it is from hand to hand and equal in amount. and similarly. µThe selling of wheat for wheat is Riba except if it is handed from hand to hand and equal in amount. p. if you will sell] wheat for wheat. Since people may cheated and exploited in several different ways . Talhah Ibn µUbaydullah called me and we discussed the matter. then receive back the same gold: the same weight and the same quality. because the one who gives more or expects more.¶ (Bukhari 1985. (Muslim 1981. is Riba unless it is from hand to hand and equal in amount¶. and then said: µWait till my storekeeper comes from the forest. p. 2029) y Narrated Abu Hurayrah: The Prophet said: µIf you give gold. [Likewise. h. h. 211) y Narrated by Talhah Ibn µUbaydullah: µUmar Ibn Khattab said that the Prophet said: µIf you will sell gold for silver then there is a danger of interest in it. and he agreed to change (my Dinars). (ibid. and if you give silver then receive back the same silver: the same weight and the same quality.
Dr Zaheer doesn¶t agree with these scholars and give his reasoning by quoting another verse from Quran that ³Do not kill your children out of fear of poverty¶ (Qur¶an. His argument for this is the fact that . He argues that based on above argument killing one child should be permissible. Dr Khalid Zaheer View on Riba Dr Khalid Zaheer is an academic who did his PhD from university of Wales in Islamic economics. Dr Zaheer also gives his view on Riba Al fadl which he believes that the only riba mentioned in Quran is the riba and Riba al fadl created unnecessary. It is important to understand Rida¶s views as most modern scholar agree to his views up to some extent. His thesis title is ³An Enquiry Into The Basic Concept of Banking As Perceived By The Spirit of Islamic Economic Justice. p31). 17:3). On topic of Riba it is his view that the reason for no clear definition of riba in Quran is the fact that concept of riba was very clear to the Arabs of that time. His view was that Riba was of two types one that Quran talks about and the other that Sunnah discusses. has been unnecessarily made problematic by the methodological framework devised by the jurists. Some argue that Rida¶s views are more in line with that of Ibn Qayyim. He was the student of Shaykh Abduh a very prominent Islamic scholar from Egypt. In case of simple interest some writers like Faizlur Rehman believe only compounded interest is not allowed and simple interest is allowed. do not take riba charging [it] doubled and redoubled´ (Qur¶an. He believes Quran is clear and unambiguous and Hadith should be assessed in the light of Quran and Sunnah. He was a learned scholar and later in his life did change his opinion on riba.´ Dr Zaheer is of view that the understanding of riba. His view was base on the fact that in Quran there is concept of Riba which he called Riba al jahiliyah is prohibited and the one in Sunnah should be avoided but can be permitted if required. They base their argument on the following Quranic verse ³O you who believe. Rida also passed few Fatwas on riba and often quoted Abduh as reference. Riba al jahiliyah for him was the doubling and multiplying of the interest. He also called such riba as riba al nisiah that with delay.Rashid Rida Rashid Rida was one of the modernist of the last century.(Nayzee. 3:1 30) that is this refers to compound interest only. On Riba Rashid Rida had a view that only compounded interest was riba and simple interest was allowed.
. It is up to the reader to make his or her own judgment on the topic. elevation of Hadith to unchallengeable status and taqlid of earlier scholars blindly. We have looked at three scholars of different era. There seem to be some agreement on the Riba that is in Quran but major difference appears when it comes to Sunnah and Hadith.we have sidelined the Quran. Conclusion Concept of Riba is not easy to explain because there are too many views on it what is allowed and what isn¶t. each providing their view on riba. The reason for us not providing our opinion is because we feel that we don¶t have adequate knowledge to have a proper opinion on this subject. The purpose of this article is not giving a definite meaning of riba but just provide views of some scholars.