At heart, this fiction seems to be the concern of those who have been knocking at the doors of Fiqh, seeking removal of Islamic embargo on interest-bearing transactions. Similarly, when Allah said, “Do not devour usury doubled and redoubled,” He did not mean, “you could devour usury if it is not doubled and redoubled.” What is meant is that charging doubled and redoubled interest is a crime more revolting. Join Yahoo Answers and get 100 points today. foot. The second type is called Riba Al Fadl, Riba An Naqd or Riba Al Bai. So, how should one understand the words “ad`aafan mudaa`afa” of the verse 130 of Aal `Imraan? However, if you repent, then you may have your principal.” (2: 278-79). I have heard that the Riba that was practiced 1400 years ago was a curse because it was a huge, cruel charge on loans (e.g. Interest vs No Interest. Further, true to the title, and despite the objective stated inside as ‘start of a debate,’ the true intent appears to be to remove any qualm in the Muslim heart and straightaway plunge into interest-bearing transactions. There are similarities and differences between the two at the conceptual level.,To support the argument, the paper shows that it is possible to prove cases where the riba is involved but the interest is not. As a final measure, Allah firmly shut the door of every effort to play with His words by saying, “Believers! He looks for a pretext to treat a haram as halal. As for what the Riba of Islam is, they did not have to explain it because the Qur’an had explained it in unequivocal terms. If asked concerning linkage of interest rates with inflation, they could respond, with scrutinizing eyes, “Say that again.”. Kobe's 'Mr. Indeed, there has been such consensus over the issue that of the dozens of deviated sects that appeared during the last 1400 years, who differed over many issues and parted ways with the mainstream Ummah, none ever differed over usury, to declare any kind of it lawful. There were many factors which helped the West achieve material progress during the last two centuries. In sum, and said regretfully, the article of Fazlur Rahman – which is at the core of all other arguments contained in the book, Riba, Usury, Interest and Qur’anic Ethics – fails quite badly when examined from Islamic legal point of view. Difference between Riba and Rent (6 answers) Closed 3 years ago. Click to share on Facebook (Opens in new window), Click to share on Twitter (Opens in new window), Click to email this to a friend (Opens in new window), An Introduction to the Arabic Language through Islamic Texts, An Important Hadith for Husband-Wife Relationship, Muslim Contribution to the Indian Independence Movement, On the Etiquettes of Giving and Receiving Gifts, The Virtue of Talking Less and Avoiding Vain Speech. Among the major publications of IQRA Publications is the popular Islamic monthly in English, the Young Muslim Digest, arguably among the foremost in this type of publishing in India. However, Islamic banking considers interest as riba, and hence, doesn’t allow it. Although the Arabic and Quranic term riba is normally translated as usury, in light of the guidance of the Quran and the Sunnah, we absolutely assure you that the Quranic term riba constitutes, encompasses, and includes both, interest as well as usury. Difference between Trade and Interest In trade, one earns profit as a result of initiative, enterprise, efficiency, hard work, profit fluctuates, and there is risk of loss as well. If the interest earned through ‘compound interest’ (or the doubled and redoubled kind) was alone prohibited by the Qur’an and not the simple type, then, why did Allah not say, “You may have your principal and the money earned as simple interest?” Why did He allow them keep back only the principal, and not the simple interest money also, if it was halal? So why was the 50-year old article pulled out from the grave and reproduced in this book? Zayd b. Aslam and Mujahid explained what the Riba of the Jahiliyy days used to be. Ennui can close the minds, otherwise someone could have also asked, “What happens when there is deflation? But for this fact, we might not have reviewed it because browsing done a few months earlier, had not invited a full reading. Riba is Arabic.English equivalent is Usury not Interest. They propagated – not on the basis of financial expertise, of which they knew not the ABC, but because they wished to promote interest-based economy – that the material development of the West was largely aided by the banks. ... Murabaha or Musawama is permissible and Halal, any return on loans and debts is prohibited due to being Riba. In actual fact, Ibn al-Qayyim is speaking of an unrelated issue. A man has his savings in the bank amounting to 100,000. Riba is bad because it is prices or amounts which rip people off. Shouldn’t interest rates be brought down too? So, profit obtained by renting property is allowed in Islam as opposed to earning profit by renting money, which is lending and earning interest. feet of land. …but the difference between riba and normal transactions are really small anyway. ? What's the difference between science and religion? This magazine is being brought out regularly by IQRA Publications since the past 36 years. The compeller will earn twofold sins: one, for using them for prostitution, and two, compelling those who love to be chaste. When dealing with Halal and Haram, Islam takes care to leave no excuse for those studying the texts in particular depth to find a pretext to escape from its obligations. That is, there is a sea of difference between saying what the Riba of the Jahiliyyah was, and, in contrast, what the Riba of Islam is, or should be. In Islam Riba (Interest) is strictly prohibited. It's a mild version of that today. Sorry, your blog cannot share posts by email. With the linkage idea so unceremoniously dismissed by the financial market, we can now look into the long article by Fazlur Rahman (1919-1988): a scholar produced by the West, employed by the West, and designated ‘an Islamic scholar’ by the West. And, if there is a good distance between traditional scholars, who do not know English, and the modern-day Islamic activists, whose main qualification is that they know English, then at least the Ameer of the Jama`at-e-Islami could have been invited. But the Qur’an has enunciated that trade and interest are not the same[16]. Syariah law claims that any form of interest is unlawful gains. Interestingly, he cites the very verse 130 of Surah Aal `Imran on which the author based his contention, viz., “Muslims! If he refused, he should be killed.”. Allah says in … In this article, I attempt to construct a clear definition for “Riba Al-Duyun”, which is the type of riba associated with loans. Then, over some time, the land prices plunge to say 1000 per sq. Can you prove that being gay is a choice? Therefore, risk is not what differentiates riba from trade. That is banks profit will not be fixed prior to business. Two million activists, journalists, BBC correspondents, Mutawallis, retired expatriates, custom officers – you name as many professions as you wish – and increase their numbers from two million to twenty million, yet, they are not equal to one Mufti, just as 20 million university graduates are not equal to a single doctor. What gave birth to the idea of a seminar on interest-bearing banking was a question sent to a Muslim news magazine. Should the banks not link the rate of interest to the rate of inflation?”. Native language speakers say that in English Interest is a nominal charge on the principal amount lent. Hence they're not the same. But doesn't that statement carry many connotations? Legally, there might be a slight difference between the two. Similarly, Allah said in the next verse, “Allah destroys usury (Riba) and cultivates charity.” He did not say He destroys usury of the “ad`aafan mud`aafa” kind alone. What happens if the rate of interest is say 7%, but the rate of inflation is 15%, which happens to be so often, in so many countries? But rather, it is the worst of its kind that has been mentioned for emphasis. Fear Allah, haply you may prosper.”. Without that, they assumed, the industrial development of the West would have been impaired. It is one of the major sins. Interest and dividends sound sort of like they should mean the same thing. It follows Western style of research adopted by their social scientists, but which is abhorred by their physical scientists. So, the answer to the question is there is no difference. Therefore, it is necessary to explain the reasons which actuated Islam in forbidding… if there's no creator wouldn't that mean that the universe is either infinitely old or popped itself into existence? In a second example, Allah said (17: 31), “Do not kill your children fearing poverty,” which does not mean, “You can kill them if you do not fear poverty.” Or, Allah said speaking about the consecrated months (ash-harul hurum) in verse 36 of Surah Tawbah, “Do not wrong yourself therein,” which does not mean, “You can wrong yourself in other months, but not during the consecrated months.” Or, Allah said about the wealth of the orphans (4: 6), “Cconsume it not wastefully and hastily in fear that they will grow up,” which definitely does not give the license to consume the property if there is no fear that they will grow up and ask for accounts. The answer is that there are two requirements to understand Qur’anic purposes: (i) know the Arabic language, (ii) know its idiomatic usage. Difference between Interest and Trade Profit. Islamically, the article is unworthy of serious consideration. 332, 1st Floor, Darus-Salam Building, Religious practice forbids riba, even at low interest rates, as both illegal and unethical or usurious. Do not devour usury doubled and redoubled. PROFIT RIBA The transaction in trade comes to an end as soon as the items and its price change hands. That is, the economy is on a free fall, and so, in general, the prices are going down and down? Fear Allah and give up any outstanding interest – if you have submitted.” There are several other verses where Riba was not qualified with any adjective. But Riba (Interest) is fixed whatever the business situation is. There is a HUGE difference between Rent and Interest. The author has no other verse supporting his personal view, no hadith, no statement of a Companion, none of the Tabi`iyyun, nor any of the Mujtahideen who appeared during the last 1400 years. "Atheism is a lack of belief in gods." Christians: Is the American flag sacred? other benefit attached with this transaction is considered as Riba (Rehman, 1993). He explains that the two were defining Riba. As an example of gimmicks, the author brings in a long passage of Ibn al-Qayyim to create the impression that Ibn al-Qayyim is also of the opinion that Riba is only that which is doubled and redoubled. Condemnation is not exclusive to Islam though there is greater emphasis in desisting from Usurious dealings in this religion. Thus, the meaning of riba can be brought into sharper focus by comparing lending with trading, as well as by contrasting riba with ribh or profit. It was interest of every kind: simple, compound or any other. The words ‘doubled and redoubled’ do not mean you can consume simple interest but not compound interest. But, Islamically, the three are, of course, the same, i.e. When a person’s belief is no more than declaration of faith in certain doctrines, then, his reasoning is reversed towards benefits of the earthly nature. 100%, 200%, 500% and sometimes 1000% of the money lent). Thus, anyone who says that the understanding of the Ummah-scholars stands rejected, is at war with Allah and with the Ummah, as are those who agree with him. It was interest of every kind: simple, compound or any other. which is excess in return and fixed.the both take the same meaning. foot. The difference between riba and selling, however, implies a distinction between riba and ribh or profit. Science would have never progressed had they adopted the research methods of the social scientists. ? Is there any difference between Riba and Interest? Fear Allah and give up any outstanding interest if you are believers. Naming his own uncle, he announced publicly, “I write off hereby the interests due to my uncle `Abbas.” He did not say, “I am writing off ‘the compound interest’ due to `Abbas but not ‘the simple interest that he had earned in the past.’” Similarly, when he wrote to the people of Najran that they will not be allowed to conduct any interest-bearing transactions, he did not specify that they could continue with simple interest banking. Riba and interest are identical Riba is, in principle, also forbidden between Muslims and non-Muslims Currently, there is no difference in the forbiddance of bank interest in Muslim-majority and non-Muslim countries. The following is a numerical example that clarifies the differences between the approaches used in riba (conventional) and Islamic financing: A family wants to buy a house for $300,000. That is, if the interest rate is say 7%, and inflation only 3%, then shouldn’t the depositors receive the interest at 3%? The debtor has to spend it first and the reproduce it and return it, to the creditor along with the interest. ? Usury means charging excessive rates of interest. The bank lends money to the customer with interest, and the customer who deposits money in the bank lends this money to the bank in return for interest. I loan Sam the $100,000 cash for 10% of 100,000 ($1000) interest each month. The wisdom in giving place to this article occupying one-third of the book is detectable. The last part of the title, ‘Qur’anic Ethics,’ has another message that slips through if the reader is unsuspecting: Qur’anic injunctions in this regard are not mandatory, but are merely ethical considerations, (towards which the Muslim attitude can safely be what it is towards other ethical values, namely, ignore them until a week before death). To explain, let us assume the real estate price is 2000 per sq. Usury first … The Qur’an said (2: 35), “Those who deal in usury (Riba) shall not rise (on Judgment Day) except as he rises whom the Devil has driven to madness by (his) touch.” (A point of note is that all the verses in the Qur’an concerning Riba were revealed after the verse containing the words “doubled and redoubled.”). . That’s what this seminar on the declared objectives would have looked like when held in March 2013. The man can now buy 100 sq. That is, if the banks promptly paid 7% interest at the end of the year, shouldn’t the depositors as promptly return 4% of the interest amount received?”. The word Ribaa is used. Riba on the other hand includes both Interest and Usury along with a host of other transactions like we have discussed whist explaining Riba al … Do not devour usury doubled and redoubled.” He cites another example from the Qur’an to show how the apparent meaning cannot be possibly taken. What it would be like to conduct a seminar on medical issues, without a single doctor present? Another possible window for a man trying to squeeze himself out of a religious obligation was closed by the words, “However, if you repent, then you may have your principal.” Now, the money lenders of the pre-Islamic times possessed two kinds of wealth: (a) principal investment money, and (b) the interests that were earned on that principal. The difference between the riba-based bank and the Islamic bank in these examples is the difference between haram, riba-based loans and Islamically-acceptable profit-sharing in which the customer may lose his money, because there is no guaranteed protection of his capital, but if he makes a profit, this gain is halal wealth. This particular verse did not say, “Those who deal in doubled, redoubled usury.” It said, “Those who deal in usury.”, The Qur’an also did not specify doubled and redoubled usury in another statement of the same verse. 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