Usury (Ribā) in Islam
Definition and Etymology
Usury (Arabic: ربا, ribā), often translated as “excess” or “interest,” refers to the unethical or exploitative practice of charging excessive interest on loans. The term encompasses a variety of financial transactions where an undue gain is made through loans of money, goods, or property.
In Hebrew, the concept is closely associated with the word “נֶשֶׁךְ” (neshek), which similarly forbids making gain from loans.
The etymology of ribā (ربا) in Arabic derives from the root r-b-w, which means to increase, to grow, or to exceed, reflecting the notion of excess or surplus gain, particularly in financial transactions.
Qur’anic View on Usury
The prohibition of usury is notably emphasized in the Qur’an. One of the most cited verses is from Surah Al-Baqarah (2:276):
<p>“Those who consume interest cannot stand [on the Day of Resurrection] except as one stands who is being beaten by Satan into insanity. That is because they say, ‘Trade is [just] like interest.’ But Allah has permitted trade and has forbidden interest. So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allah. But whoever returns to [dealing in interest or usury] - those are the companions of the Fire; they will abide eternally therein.” (Qur’an 2:276)</p>
Hadith Overview
The prophetic traditions (Hadith) also unequivocally condemn the practice of usury.
The Prophet Muhammad is reported to have said:
<p>“Cursed be the taker of usury, the giver of usury, the writer of usury, and the witness of usury, for they are all equal.” (Ṣaḥīḥ Muslim, Bābu ‘r-Ribā)</p>
<p>“Verily the wealth that is gained in usury, although it be great, is of small advantage.” (Ṣaḥīḥ Muslim)</p>
Legal Interpretation and Jurisprudence
In Islamic law (Shari’ah), ribā broadly signifies any excess according to a legal standard of weight, measure, or time which is conditionally stipulated in a contract. The prominent Islamic jurists have nuanced views on the matter:
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Hanafī Jurisprudence: Usury occurs in cases where items of the same kind are exchanged with an excess on one side or with a delay in delivery. Exceptions are made for different kinds of items like selling barley for wheat.
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Shāfiʿī Jurisprudence: Usury is recognized specifically in things edible or currency. Unlike Hanafi jurists, Shāfiʿī scholars do not consider non-measurable items, such as cloth, susceptible to ribā.
Key Concepts in Usury
- Types of Usury: Ribā can be Ribā al-Fadl (usury of surplus, where an excess is agreed without equivalence in return) or Ribā al-Nasī’ah (usury of delay, where time plays a role in the transaction).
- Legal Consequences: Transactions involving usury are considered invalid and unethical. For example, the evidence provided by a person known to engage in usurious practices may be inadmissible in an Islamic court.
- Economic Impact: The restrictions on usury aim to promote fairness and equity within the community, protecting the financially vulnerable from exploitation.
Islamic Scholarship and Further Studies
For in-depth examinations of usury in Islamic context, consider the following key texts:
- “Hidayah” by Burhan al-Din al-Marghinani
- “Fatāwā-i-ʻĀlamgīrī” compiled by various scholars under Mughal Emperor Aurangzeb
- “The Durr al-Mukhtār” by Imam Muhammad Ala-u-din Haskafi
Takeaways
- Ethical Imperative: Islam prohibits ribā to ensure just and equitable financial practices.
- Legal Rulings: Detailed Islamic legal rulings clarify the types of transactions considered usurious.
- Scholarly Diversity: There are nuanced differences in the scholarly interpretations of ribā among various Islamic jurisprudential schools.
Conclusion
The concept of Usury (Ribā) in Islam serves as a protective measure against financial exploitation and ensures a just economic system. The prohibition of ribā aligns with broader Islamic values of justice, fairness, and social welfare, reflecting its significant moral and legal stance in Islamic teachings.
For further exploration, delve into the recommended classic texts, which offer extensive insights into the historical and jurisprudential aspects of usury in Islam.
