What is Interest?
Also called Riba in Arabic, it means an unlawful increase in the amount of money or commodity to be paid back by a borrower to a lender. Any predetermined addition to the amount that is to be paid is considered interest. Riba is more succinctly defined by Hazrat Shah WaliullahDehlvi. He said “Riba` is a loan with the condition that the borrower will return to the lender more than and better than the quantity borrowed.”
Why is Riba Haram?
First and foremost for a Muslim, your first point of reference for any matter should be the Quran, Allah’s words. It is clearly stated in the Quran in more than one occasion that riba is haram.
In Surah Al-Baqarah verse number 275 Allah said:
“Those who devour usury will not stand except as stands one whom the Satan by his touch has driven to madness. That is because they say, “trade is like usury”, but Allah has permitted trade and has forbidden usury”.
Then in the next chapter of the same Surah He said:
“Allah will deprive usury of all blessing, and will give increase for deeds of charity, for he does not love any ungrateful sinner.”
There are many more places in the Quran in which Allah strongly prohibits Riba so it should be clear to every Muslim that riba is Haram. Indeed riba is the only sin in which Allah mentions waging a war on the culprits saying in verse 278 and 279 of surah Al-Baraqah,
“Oh you who believe! Fear Allah and give up what remains of your demand for usury if you are indeed believers.”
“If you do not, take notice of war from Allah and his Messenger sallallahualaihewasallm but if you repent you shall have your capital sum. Deal not unjustly and you shall not be dealt with unjustly.”
The Prophet SAW also made mention of the severity of RibaHazrat Abu Hurairah radiyallahuanhu reported that the Messenger of Allah sallallahualaihewasallm said: Usury has got seventy divisions. The easiest division of them is a man marrying his mother (Ibn Majah)
There are more practical reasons in our day-to-day lives that makes Riba so frowned upon, like the exploitation of the poor by the rich and the destruction of society to name a few. This tells you that Riba does not only have serious implications in the hereafter, it also has very toxic ramifications in our societies.
Other negative effects of Riba include
- It breaks the bond of brotherhood and kinship between people as sympathy and mercy is overwritten by greed and selfishness.
- Most of the financial fluctuations and volatility like inflation is caused by riba.
- It increases the debt of people, especially poor people, leading to depression and anxiety.
- It widens the gap between the rich and the poor, and creatsan environment in which the poor are exploited by the rich.
- All of the risk is on the borrower and the lender is always in a win-win situation.
How To Stay Away From Riba
This the problem many Muslims face nowadays, knowing that riba is Haram but still not being able to save themselves from it. In fact the Prophet SAW did mention how hard it would be to stay away from Riba in generations to come (our generation). Hazrat Abu Hurairah radiyallahuanhu reported that the Holy Prophet sallallahualaihewasallm said: A time will certainly come over the people when none will remain who will not devour usury. If he does not devour it, its vapour will overtake him. In this Hadith we can see that the Prophet knew that a time would come in which riba dealings will be so widespread and hard to resist but that doesn’t make it any less sinful. It is down to you as a Muslim to lay down a marker and save yourself from the evil indulgence of riba dealings. Here are few ways to start:
- Dealing with Islamic bank as opposed to commercial banks
- Staying away from interest accruing accounts if you are with a commercial bank
- Borrowing from friends and family that won’t charge you interest
- Trimming your spending according to your earnings and staying away from borrowing a lot.
Staying away from riba may not seem possible in this our generation but that shouldn’t deter us as Muslims from maintaining our integrity and the very thing that makes us Muslims. It is our obligation as Muslims to rid ourselves and society from the vices of Riba and start turning to Halal ways of earning.