Riba (interest), reasons for it to be haram?

Question

salam
i have to make a project for my 'economics' course and i want to avail this oppertunity to spread the word of Allah and want to tell people about interest and why it is haram.i have researched from various books Alhamdolillah,and i want you people to contribute to this,remember your contribution will be rewarded by Allah.

i want more info regarding various logical reasons islam and ulemas have given to tell why interest is haram.please share the information or its link.

i also want some info regarding those fatwas that try to spread this misconception among the muslims that it is impossible to stay away from interest in this modern time so it is allowed for a muslim(Na'uzubillah)

i want to tell as much as i can to my colleagues about this topic because people are ignorant about interest,that is why i want to gather as much detail as possible so therefore i ask you to help me to spread the knowledge of Islam among people and Inshallah bring a +ve change in their lives.

right now, the outline of my project and presentation is telling about

1)interest and why is it haram

2)the various fatwas or ideas that people come up with to say that interest is not haram

3)the Islamic way of banking and various alternatives to interest like mudarbah, musharkah etc. that a person can have, in order to be safe from interest.

is this format alright? or is there something that i can add to it?

Answer 1

In Addition to above answers..I would say that..
There are two issues with regard to Riba..
1. Individual problem pertaining to Riba.
Here a person becomes too greedy of money, he pays money to person in extreme need and force the person to pay back more money who is already in finanacial problem. because of this; brotherhood, sympathy, etc disappear for society.

2. Socio-economic effect. If riba becomes norm of the society, it create lots of social and economic upheavel in the society which works only for rich against poor.
Let me give an example..
a. I need to travel from home to office on daily basis, and interest based banking system is not at all functioning in the society, what shall I do now? I will use public transport to go to office, sometime after few years I gather some money to buy a car (used or new) and travel by using that car.
b. I need to travel from home to office on daily basis, and interest based banking system is functioning in the society, I take a loan from bank and buy the car and keep paying for another 3-5 years from my salary..
Just imagine economic effect of condition b.
Because most of people can afford to buy a car by using credit facility, cars will be expensive.
Because, many people buy cars by using credit facility, I am be tempted to buy car even though I do not need it.
Because, many people buy cars by using credit facility, companies would make more expensive and luxurious cars and tempt people to buy expensive cars.
Expensive cars will be common in the society despite the lower level of income.
Usage of public transport would reduce and evnetually quality of public support also would decrease.
Gradually society would convert into group of people always tend to exhbits the wealth, compete in luxury and too low in contentment.
Banks would lure people spend the money which they do not own.
multinationals would lure the people to buy products which they can't afford.
Everything above works only in favour of rich capitalists against poor.

Eventually the whole society is converted to a greedy, hedonist, exhibitionist society. They would become more like economic animamls instead of realising their spiritual duty. Every day they would be thinking only about paying their installments and work hard, try to earn more money, forget about religious and family obligations.

What I have spoken above can be observed in daily life of people all over world.

Now, Just imagine that interest based banks are not their..and recalculate each and every economic and social factors. You will see that eveything would be much better.

Answer 2

walaykum salam

This is a very important question. Dont forget the most important reason. ALLAH SAID RIBA IS HARAM. It is like sexs with your mom. said the prophet - peace be upon him.

whether we know the wisdom of or we dont, we are muslims we hear and obey our creator Allah the most wise. why do we have 10 fingers instead of 12 or 8?

FYI, japan had 0% interest in 2001 check bbc

in islam a loan is charity. you can not give chrity and then hurt the person by reminding him i gave you money or by making him more poor

Answer 3

Interest is the reason why a nation is in debt. As long as interest exists or coexists there is no escape of debt; you will always be overwhelmed and overpowered by money. Is not Allah the wisest of judges? أَلَيْسَ اللَّهُ بِأَحْكَمِ الْحَاكِمِينَ [Surat At-Tīn 95:8] Those who devour interest will not stand except as stand one whom the Evil one by his touch Hath driven to madness. That is because they say: "Trade is like interest," but Allah hath permitted trade and forbidden usury. Those who after receiving direction from their Lord, desist, shall be pardoned for the past; their case is for Allah (to judge); but those who repeat (The offence) are companions of the Fire: They will abide therein (for ever). الَّذِينَ يَأْكُلُونَ الرِّبَا لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ الَّذِي يَتَخَبَّطُهُ الشَّيْطَانُ مِنَ الْمَسِّ ۚ ذَٰلِكَ بِأَنَّهُمْ قَالُوا إِنَّمَا الْبَيْعُ مِثْلُ الرِّبَا ۗ وَأَحَلَّ اللَّهُ الْبَيْعَ وَحَرَّمَ الرِّبَا ۚ فَمَن جَاءَهُ مَوْعِظَةٌ مِّن رَّبِّهِ فَانتَهَىٰ فَلَهُ مَا سَلَفَ وَأَمْرُهُ إِلَى اللَّهِ ۖ وَمَنْ عَادَ فَأُولَٰئِكَ أَصْحَابُ النَّارِ ۖ هُمْ فِيهَا خَالِدُونَ [Surat al-Baqrah 2:275] Charity (zakat) is better. Ma'salama.

Answer 4

Oh, its haram because if borrow 4$ from a friend and tomorow u pay him back 6$ so when u give the person extra money and he used it this money will be called (floos haram).
Hope that helps!

Answer 5

1. Yes Riba is haram.

2. Why? Because it burdens the borrowers.

Example: If one borrows 10 kilos of wheat. The borrower must only pay back 10kilos of wheat. If the borrower pays back in 2or 3 years, would that affected the wealth of the lender? No. After a few years, the lender still be able to get back his 10 kilo wheat.

3. Borrow & lend money. This is when ulamas and the purported Islamic bankers are mistaken.
They cannot make the borrowings of money 'halal' by simply swithcing it to 'buy&sell' transaction. They cheat themselves.

Two parties' intention to borrow/lend money must be well implied in the contract. Intentions must paralel with akad/contract/agreement. So, present Islamic banking that camouflage the ursury is indeed haram.

4. Money is different than goods(wheat/gold/copper).

Because money has no intrinsic value, and subject to depreciation.

5. Why depreciation? because central banks (i) print out money every year, (ii) creation of money via banking system. That depreciate the value of money.

Example: Today you lent USD100 to Mr A. With that USD100, you can buy 100 bottles of medicine for your mother today. But after a year, Mr A pays back USD100 to you. But with that USD100, you may only get 95 bottles of medicine, due to inflation.

Well, this is not fair to you, as the lender. In Islam, all deals MUST be fair to all parties.

6. Therefore when you want to lend monies, make sure you identify what actually you are lending. If you are lending the notes of USD100. It is a Riba (forbidden) for you to ask for USD105 after a year.

But if you are NOT referring the item as nominal value printed on the notes, but the REAL VALUE/Price of the MONEY, say notes USD100 today is to be lent for PRICE/value of USD105 -1 year money, & the borrower agreed on the pricing/value, then it is NOT riba. It is NOT haram.

(Money or paper money is similar to shares certificates. Both have NOMINAL VALUE (nominal value printed on the notes or shares). But when people borrow or buy the shares, they have different pricings, referring to the REAL VALUE today, tomorow, 1 year, 2 year, 5 year and so on. Usually more than what is printed on the paper.)

Answer 6

it is haram because it means to jsut take money from loaners..

Lets just say.. u borrow money from friends.. u borrow 5$.. tomorrow they ask for 6$ is that fair? NO! if they want to keep the money.. just keep it! dont have to put interest

Answer 7

it is a way of taking money from the poor and giving it to the hands of the rich

Answer 8

Please search www.sunnipath.com for details, look under the answer section and search.

Answer 9

please follow this link .... http://www.islamqa.com/index.php?cref=313&ln=eng
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