"May the Peace and Blessings of Allah be Upon You"
Praise be to Allaah, we seek His help and His forgiveness. We seek refuge with Allaah from the evil of our own souls and from our bad deeds. Whomsoever Allaah guides will never be led astray, and whomsoever Allaah leaves astray, no one can guide. I bear witness that there is no god but Allaah, and I bear witness that Muhammad is His slave and Messenger.
Bismillah Walhamdulillah Was Salaatu Was Salaam 'ala Rasulillah
As-Salaam Alaikum Wa-Rahmatullahi Wa-Barakatuhu
Usury / Interest: An Islamic Perspective
- Imran Ayub
1. Definition
The Oxford English Dictionary definition for Interest is as follows: “Money paid for the use of money lent (the principal), or for forbearance of a debt, according to a fixed ratio (rate per cent.).”[1]
2. Allaah will Destroy Usury
“Allah will destroy Ribaa (usury) and will give increase for Sadaqaa (deeds of charity, alms, etc.) And Allah likes not the disbelievers, sinners.”[2]
Al – Haafiz Ibn Katheer commentary[3] is as follows: “Allaah states that He destroys Ribaa, either by removing this money from those who eat it, or by depriving them of the blessing, and thus the benefit of their money. Because of their Ribaa, Allah will torment them in this life and punish them for it on the Day of Resurrection. Allah said,
“Say (O Muhammad SAW): ‘Not equal are Al-Khabeeth[4] and AtTaiyib[5], even though the abundance of Al-Khabeeth (evil) may please you.’ So fear Allaah much, O men of understanding in order that you may be successful.”[6] “…and put the wicked[7] one on another, heap them together and cast them into Hell. Those! It is they who are the losers.”[8] “And that which you give in gift (to others), in order that it may increase[9] from other people's property, has no increase with Allâh,...”[10]
Ibn Jareer said that Allaah’s statement: “Allaah will destroy Ribaa…” is similar to the statement reported of Abdullaah bin Masood, Ribaa will end up with less, even if it was substantial.’[11] Imaam Ahmad recorded a similar statement in Al – Musnad.[12]
It was narrated from ibn Masood (may Allah be pleased with him) that the Prophet (peace be upon him) said, “There is no one who deals in usury a great deal (to increase his wealth) but he will end up with little (i.e., his wealth will be decreased).”[13]
3. Punishment on the Day of Judgement
Allah, the Most High, says in the Qur’aan, “Those who eat Riba (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Shaitaan (Satan) leading him to insanity. That is because they say: ‘Trading is only like Ribaa (usury),’ whereas Allah has permitted trading and forbidden Ribaa (usury). So whosoever receives an admonition from his Lord and stops eating Ribaa (usury) shall not be punished for the past; his case is for Allah (to judge); but whoever returns [to Ribaa (usury)], such are the dwellers of the Fire - they will abide therein.”[14]
Al – Haafiz Ibn Katheers commentary[15] is as follows: “This Ayah means, on the Day of Resurrection, these people will get up from their graves just as the person afflicted by insanity or possessed by a demon would. Ibn `Abbas said, “On the Day of Resurrection, those who consume Riba will be resurrected while insane and suffering from seizures.”[16]
…Thereafter, Allah said, “So whosoever receives an admonition from his Lord and stops eating Ribaa (usury) shall not be punished for the past; his case is for Allaah (to judge)”, meaning, those who have knowledge that Allah made usury unlawful, and refrain from indulging in it as soon as they acquire this knowledge, then Allah will forgive their previous dealings in Riba.”
4. Those who Deal with Usury Declare War with Allah
“O you who believe! Be afraid of Allah and give up what remains (due to you) from Riba (usury) (from now onward), if you are (really) believers. And if you do not do it, then take a notice of war from Allaah and His Messenger but if you repent, you shall have your capital sums. Deal not unjustly (by asking more than your capital sums), and you shall not be dealt with unjustly (by receiving less than your capital sums).”[17]
Al – Haafiz Ibn Katheer’ commentary[18] is as follows: “Ibn Jurayj said that Ibn Abbas (may Allah be pleased with him) said that, “then take a notice of war” means, ‘Be sure of a war from Allah and His Messenger.’[19] He also said, ‘On the Day of Resurrection, those who eat Riba will be told, ‘take up arms for war.’’[20]
5. Punishment in the Grave
Narrated Samura ibn Jundab (may Allah be pleased with him): The Prophet (peace be upon him) said, “This night I dreamt that two men came and took me to a sacred land whence we proceeded on till we reached a river of blood, and in it (its middle) there was a man, 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 Ribaa – eater.’”[21]
6. Usury is Cursed
It was narrated from Abduallaah ibn Masood (may Allah be pleased with him) that the Messenger of Allah (peace be upon him) cursed the one who consumes usury, the one pays it, those who witness it and the one who writes it down.[22]
It was narrated from Aboo Hurayrah (may Allaah be pleased with him) that the Messenger of Allah (peace be upon him) said, “There are seventy degrees of usury, the least of which is equivalent to a man having intercourse with his mother.”[23]
7. One of the Destructive Sins
Narrated Aboo Hurayrah (may Allah be pleased with him): The Prophet (peace be upon him) sad, “Avoid seven great destructive sins.” They (the people) asked, “O Allaah’s Messenger! What are they?” He said, “ (1) To join partners in worship with Allah; (2) To practice sorcery; (3) To kill the life which Allaah has forbidden, except for a just cause (according to Islaamic law); (4) To eat up Ribaa (usury); (5) To eat up the property of an orphan; (6) To show one’s back to the enemy and fleeing from the battlefield at the time of fighting; (7) And to accuse chaste women who never even think of anything touching their chastity and are good believers.”[24]
8. Imitating the Jews
“For the wrongdoing of the Jews, We made unlawful to them certain good foods which has been lawful to them, and for their hindering many from Allaah's Way; And their taking of Ribaa (usury) though they were forbidden from taking it and their devouring of men's substance wrongfully (bribery, etc.). And We have prepared for the disbelievers among them a painful torment.”[25]
Al – Haafiz Ibn Katheer commentary is as follows: “Allah states that because of the injustice and transgression of the Jews, demonstrated by committing major sins, He prohibited some of the lawful, pure things which were previously allowed for them. This prohibition could be only that of decree, meaning that Allah allowed the Jews to falsely interpret their Book and change[26] and alter the information about what was allowed for them. They thus, out of exaggeration and extremism in the religion, prohibited some things for themselves. It could also mean that in the Tawrah, Allah prohibited things that were allowed for them before….Allaah prohibited them from taking Ribaa, yet they did so using various kinds of tricks, ploys and cons, thus devouring people's property unjustly.”[27]
9. Mortgages and Interest Based Loans
Ibn Qudaamah (may Allah have mercy on him) said: “Every loan in which it is stipulated that an additional payment be made is haraam, with no scholarly dispute. Ibn al-Mundhir said: They are unanimously agreed that if the lender stipulates that the borrower must pay extra or give a gift, and he gives the loan on this basis, this is riba. It was narrated from Ubayy ibn Ka’b, Ibn ‘Abbaas and Ibn Mas’ood that they forbade loans that lead to any kind of benefit (extra payment, gifts, etc).”[28]
The Standing Committee was asked about the Islamic ruling on taking a loan from a riba-based bank in order to build a modest house. They replied: “It is haraam to take a loan from banks or elsewhere with riba, whether that is to build something or to spend it on food, clothing or medical expenses or to start a business and earn more money, or any other purpose, because of the general meaning of the verses that forbid riba, and the general meaning of the ahaadeeth which indicate that it is haraam. Similarly it is not permissible to deposit money in banks etc that pay interest.”[29]
Mufti Muhammad Taaqi Usmani said, “The correct position is that dealing in interest is haram, both in a Muslim or a non-Muslim country. Some jurists have opined that interest bearing loans can be given to a non-Muslim citizen of a non-muslim country, and the interest charged from him is halal for a muslim. But this view has not been endorsed by the majority of the jurists. So, the correct view is that charging interest is not permitted in any case, no matter whether the debtor is a citizen of a Muslim country or not.”[30]
Mufti Muhammad ibn Adam al-Kawthari said, “Usury, interest transactions and mortgages are totally prohibited in Islaam. There are grave warnings promised in the Qur’an and Sunnah for the one who involves himself in interest based transactions.”[31]
Dr. Khalid Khan said, “Mortgage is based on interest, and interest is haraam and is one of the major sins in Islaam, which can never become halaal at all. There is no argument or difference of opinion on this issue. Whoever makes a difference or dispute on this issue has differed from Allaah and His Messenger (peace and blessings of Allah be upon him). The seriousness of dealing in interest is shown by Aayaat of the Qura'an and many Ahadeeth of the Prophet (peace and blessings of Allah be upon him).”[32]
And It is Only Allaah Who grants success. May Allaah Exalt the mention of His slave and Messenger Muhammad (peace be upon him), and render him, his household and companion safe from Evil.
[2] The Noble Qur’aan, Soorah Al-Baqarah 2:276
[3] Tafseer ibn Katheer, Volume 2, p. 75 – 76
[4] All that is evil and bad as regards things, deeds, beliefs, persons, foods, etc
[5] All that is good as regards things, deeds, beliefs, persons, foods, etc.
[6] The Noble Qur’aan, Soorah Al-Ma'idah 5:100
[7] Disbelievers, polytheists and doers of evil deeds
[8] The Noble Qur’aan, Soorah Al-Anfal 8:37
[9] Your wealth by expecting to get a better one in return
[10] The Noble Qur’aan, Soorah Ar-Rum 30:39
[11] At-Tabari 6:15
[12] Ahmad 1:395
[13] Sunan Ibn Maajah, Volume 3, Hadeeth Number 2,279, p. 301; Classed as Saheeh by Haafiz Aboo Taahir Zubayr ‘Alee Za’i
[14] The Noble Qur’aan, Soorah Al-Baqarah 2:275
[15] Tafseer ibn Katheer, Volume 2, p. 70 – 71
[16] At-Tabari 6:9
[17] The Noble Qur’aan, Soorah Al-Baqarah 2:278 – 279
[18] Tafseer ibn Katheer, Volume 2, p. 79 – 79
[19] At – Tabari 6:26
[20] At – Tabari 6:25
[21] Saheeh Bukhaari, Volume 3, Book 34, Hadeeth Number 2,085, p. 174
[22] Sunan Ibn Maajah, Volume 3, Hadeeth Number 2,277, p. 300 – 301; Classed as Hasan by Haafiz Aboo Taahir Zubayr ‘Alee Za’i
[23] Sunan Ibn Maajah, Volume 3, Hadeeth Number 2,274, p. 299; Classed as Hasan by Haafiz Aboo Taahir Zubayr ‘Alee Za’i
[24] Saheeh Bukhaari, Volume 8, Book 86, Hadeeth Number 6,857, p. 447
[25] The Noble Qur’aan, Soorah An-Nisa 4:160 – 161
[26] In the Bible, it states, “Do not charge a fellow Israelite interest, whether on money or food or anything else that may earn interest.” [Deuteronomy 23:19] However, the next verse shows the addation made but the Jews, “You may charge a foreigner interest, but not a fellow Israelite, so that the LORD your God may bless you in everything you put your hand to in the land you are entering to possess.” [Deuteronomy 23:20]
[27] Tafseer ibn Katheer, Volume 3, p. 44 – 46
[28] Al-Mughni, 6/436, http://www.islamqa.com/en/ref/39829
[29] Fataawa al-Lajnah al-Daa’imah (13/385), Ibid.,
[30] ‘Dealing in Interest in America or UK’, http://www.muftitaqiusmani.com/index.php?option=com_content&view=article&id=45:dealing-in-interest-in-america-or-uk&catid=10:economics&Itemid=17
[31] ‘Mortgage and Car Insurance’, http://www.daruliftaa.com/question?txt_QuestionID=q-18585073
[32] ‘Is it allowed to take a mortgage?’, http://www.drkhalid.co.uk/questions/013.html
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