What is ‘riba’ in Islam?
The Arabic word ‘riba’ means ‘excess,’ ‘increase,’ ‘addition,’ ‘expanse,’ or ‘growth.’
In the Shari‘ah, or Divine Way of Islam, riba is the name Allah gave in the Quran to any increase of a debt or a loan until its repayment. It is equal to the financial terms ‘interest’ or ‘usury’ in English, with no distinction between these two words and riba.
In other words, riba is money paid at a particular rate of increase over time for the use of money lent, or for delay in debt repayment beyond a loan or debt’s specified life.
Does Islam forbid ‘riba’?
Yes. Allah emphatically forbidden riba in all its forms and declared its practice equal to disbelief in Him.
Prophet Muhammad, on him be peace, has also specified it and prohibited it in clear terms.
There is consensus among Muslim scholars, moreover, on the illegality of dealing in riba.
Why does Islam forbid ‘riba’?
Islam outlaws riba in all its varieties because it is the principal mechanism that empowered human beings impose to perpetually institutionalize their wealth – as individuals and as groups – in the form of a direct dividend paid to the wealthy on their wealth from the wealth of the disempowered, permanently impoverishing them.
Allah has explicitly classified loans (s. qard) as a category of charity, sadaqah, which must be given freely in goodness (hasan) to help someone in need for the sake of Allah, or to someone who is deserving of your dutiful assistance, like parents or relatives.
In addition, Allah has designated debt-relief as the sixth of the eight divine purposes of the Zakat alms He has required annually from every Muslim with qualifying wealth. It is a due payment owed to the recipients He Himself has listed as eligible. Zakat is a compulsory form of charity in Islam.
It is immoral to make money from your charity to someone in need. And it is corrupt to put someone in debt and charge them for their debt when Allah has made their debt-relief mandatory.
Some people of Heavenly Revelation – including some Muslims – say Allah has permitted charging interest, or other kinds of defrauding, to people not of their faith. Rather, we are to fear Allah, for Allah has condemned this as a falsehood against Himself:
That is because they say: It is not incumbent upon us to keep faith with people unlettered in our religion! And thus do they speak lies against Allah – and they do so knowingly. Rather, whoever fulfills his covenant and fears Allah, know that Allah, indeed, loves the God-fearing. (Surat Aal ‘Imran, 3:75-76)
Does the Quran explicitly forbid Interest?
Yes. Allah forbid it categorically in the Quran in four commandments:
1. Allah prohibits riba’s consumption and invalidates it as a type of selling:
Those who devour interest shall not rise on Judgment Day, except as one rises whom Satan has battered with the touch of madness. That is because they say: Indeed, selling is just like interest – while Allah has made selling lawful and has prohibited interest. So when an admonition comes to one from his Lord, and he quits interest, then to him belongs what was formerly gained. And his affair henceforth rests with Allah. But whoever returns to interest – then these are the Companions of the Fire of Hell. They shall abide therein forever.” (Surat Al-Baqarah, 2:275)
2. Allah blights riba of all blessing in contrast with the abundant increase He bestows on charity:
Allah obliterates all blessing from interest and increases generously the reward for charity. For Allah loves no relentlessly unbelieving sinner.” (Surat Al-Baqarah, 2:276)
O you who believe! Be ever God-fearing and forsake all that remains due to you from interest, if, indeed, you are believers.” (Surat Al-Baqarah, 2:278)
4. Allah bans lenders from attaching any simple riba multiplier to their loans or compounded riba attached to both initial principal and accumulated interest:
O you who believe! You shall not consume interest on anything lent, multiplying and compounding the return. Rather, be ever God-fearing, so that you may be successful.” (Surat Aal ‘Imran, 3:130)
Was interest forbidden for any people before Muslims?
Yes. All the Heavenly Books have prohibited riba absolutely. Allah says He punished a believing people before Muslims by restricting the foods they could lawfully eat, in part, for violating His prohibition on them against taking riba:
Because of the wrongdoing perpetrated by those of Jewry, We have made forbidden to them wholesome foods previously made lawful to them – and also … for their taking of interest, though they were forbidden to do it. …” (Surat Al-Nisa’, 4:161)
<H2> Is the prohibition on people profiting from interest offset by anything in Islam? <H2>
Yes. Allah specifically contrasts the divine losses that accrue to those who give riba loans to gain from people with the much-multiplied blessing He gives to those who pay the obligatory Zakat to the poor and needful for His sake alone:
Yet beware, for whatever you give others in interest – to gain increase from the wealth of people – shall never increase with Allah! But blessed is whatever you give of the Zakat-Charity – desiring only the Face of God. For it is such as these who shall have a much-multiplied reward.” (Surat Al-Rum, 30:39)
He also contrasts the unseen ruin of people who deal in riba with the immense profit gained by those who give sadaqah, which includes obligatory Zakat alms, but also all types of voluntary charity (see Surat Al-Baqarah, 2:276 and Surat Aal ‘Imran, 3:130-34).
Did the Prophet, on him be peace, speak about interest?
Yes, repeatedly, and in frightening terms.
The Prophet Muhammad, on him be peace, categorized riba – its imposition, consumption, contractual inscription, and validation – as the fourth of the “seven deadly deeds,” meaning the seven major sins, so called because they doom those who commit them to Hellfire in the Hereafter.
He said:
Shun the seven deadly [deeds]. ‘It was said [by a Companion listening to him]: O Messenger of Allah! What are they?’ “He said: Association of partners with Allah; the practice of sorcery; the killing of any person – which Allah has forbidden – except by a divinely established right; the consumption of interest; the consumption of an orphan’s wealth; fleeing on the day of advance into battle; and the defaming of virtuous, innocent, believing women.” (Nasa’i)
He said also:
Cursed are the receiver and the payer of interest, and the one who records it, and the two witnesses to the transaction. All are alike [in their guilt].” (Muslim)
In his celebrated Farewell Address to us, he said:
All riba of the Days of Ignorance before Islam is annulled, and the first riba I annul is our riba [meaning of his close clan relations], that accruing to ‘Abbas ibn ‘Abd al-Muttalib [his paternal uncle]. It is cancelled in total.” (Muslim)
He ranked riba high among the great sins:
A single coin of riba that a man receives knowingly is worse than committing adultery thirty-six times.” (Ahmad)
He said, as well:
On the Day of Resurrection, the interest-takers will be raised up insane. Others shall recognize them as interest-takers for their madness.” (Dhahabi)
He said, as well:
On the Day of Resurrection, people will swiftly rise up from their graves, but not those who consumed interest in life. They will stand up then fall down as one struck with seizures. Whenever they try to stand, they fall over because of their consumption of interest in this world. For as punishment on the Day of Resurrection, Allah fills their stomachs with a most weighty thing, the weight of which topples them when they stand. They try to hasten along with the people but cannot. (Dhahabi)
He related much on the consequences of consuming interest from his miraculous Night Journey and Ascension to Heaven (Isra wa’l Mi’raj):
In my Ascension, I passed a group of people whose stomachs were as large as houses bent down upon a path by which Pharaoh’s people were driven morning and evening to the torment of the Fire. Pharaoh’s people were like beaten camels on their return, neither listening nor sensible. When the people of distended stomachs saw their approach, they tried but failed to stand, so the people of Pharaoh trampled them as they wobbled [beneath their feet] to and fro. This is the [interest-consumers’] punishment in the intermediary realm of the grave [barzakh]. I asked [the Arch-Angel] Gabriel, ‘Who are these people?’ He said: ‘These are the people who consumed interest. They will not stand ‘except as one rises whom Satan has battered with the touch of madness.’” (Bayhaqi)
In my Ascension, I heard thunder and lightening overhead in the Seventh Heaven, and I came upon people with stomachs as large as houses between their hands, with snakes and scorpions inside them visible from outside. I asked: ‘Who are they?’ He said: ‘The consumers of interest.’" (Ahmad)
We arrived at a stream whose water was red like blood. A man was swimming in it. On the bank of the stream was another. He had collected many stones. Whenever the swimmer approached him, he struck him with a stone that smashed his face. The swimmer would again swim until he approached the bank, and the other would strike him with a stone that smashed his face. The Prophet, on him be peace, asked [the Arch-Angel] Gabriel about the two of them. Gabriel said: ‘The man swimming and being stoned earned his money [in life] from interest.’" (Dhahabi)
‘Abd Al-Rahman son of ‘Abd Allah, son of Mas‘ud reported that his father said:
When adultery and fornication (zina) and interest (riba) appear in a land, Allah orders its destruction." (Dhahabi)
The Prophet, on him be peace, said:
The appearance of interest (riba) among a people is followed by the appearance of insanity among them. The appearance of adultery and fornication (zina) is followed by the appearance of death [among them]. And if they cheat in weights and measures, Allah denies them rain." (Dhahabi)
He said also:
Four Allah justly does not admit to the Garden, nor shall they taste its blessings: The One who gives himself up to the drinking of alcohol; the one who consumes interest (riba); the one who consumes the orphan’s wealth without right; and the undutiful to parents, save the one who repents." (Dhahabi)
We seek Allah’s protection, deliverance, and forgiveness from riba, and we repent from its pervasive taint of our wealth in these times.