In the name of God, the compassionate the merciful
Riba is any increase stipulated on a loan (money), where one is required to pay more than they borrowed, or give a benefit to the lender as a compensation for the money lent. It is forbidden according to the Quran and Sunnah, and ijma’a (scholarly consensus). It is saturated with myriads of evils.
Riba is one of the Al-Mubiqaat As-Sab’a (seven major sins), and a greatly punishable act of wrongdoing to oneself and others. A person becomes guilty of committing one of the most heinous and severely admonished sins in Islam. The Qur’an warns us of a war with God and His Messenger, and humiliation in both this life and the next, signifying that riba is a matter that is not taken lightly in our religion
Quran: 2:278-279 states “O you who have believed, fear God and give up what remains due to you of interest, if you should be believers. And if you do not, then be informed of a war against you from God and His Messenger. But if you repent, you may have your principal, thus you do no wrong, nor are you wronged.”
In spite of the extreme prohibition of this destructive sin, many may be unaware of the consequences of engaging in riba. A respected teacher of mine once shared a story with us, as an intern at the largest Islamic bank in her region; she had to conduct a survey with the clients of the bank. She had asked over 50 people the same question: What does Islam say about Riba? Expecting that the prohibition of Riba would be their main drive for their choice of an Islamic bank, she was utterly disappointed to find that only 2 or 3 people could provide her with an answer.
When we live in a society where the condemnation of riba is not widely spread, then this is truly a calamity. One must be aware of what the faith prohibits in order to avoid falling into it. Such knowledge is not restricted to Islamic Finance professionals as some may think rather, it is incumbent upon every Muslim to be aware of the abhorrent consequences of riba.
Clarifying Widespread Misconceptions
Claims such as ‘If you are buying your first house then you are allowed to buy it on interest’ or ‘Interest is the same as profit’ would only come from people who are misinformed regarding the true reality of riba. One must strive to avoid this horrendous sin with all the effort they possess in order to not bring the wrath of Allah upon them.
A serious misconception amongst people is that only those who directly deal in riba will receive punishment from Allah. However, we must reflect on this very important hadith: “Jabir said that Allah’s Messenger cursed the acceptor of interest and its payer, and one who records it, and the two witnesses, and he said: They are all equal”, Sahih Muslim 1598. Whether one is responsible for the recording of a riba-based loan and witnessing the transaction, or simply working in a conventional bank as a driver or even a guard, all are impermissible. A Muslim must only enjoin in good and working in this field implies that one approves of it.
The argument that ‘Interest is not the same as usury and that only usury is prohibited’ is a futile argument. Islam does not distinguish between a minimal and an exorbitant rate of interest, as both are equally prohibited.
Social consequences of Dealing in Riba
Promotes selfishness, mercilessness, and lust for money; because those who give out loans will charge any amount of interest, they desire just to accrue more and more wealth.
Creates enmity between the rich and the poor, leading to social classes and divisions between people.
Exploits the need of the poor. Most people of affluence do not agree to help a needy person on the basis of Qard Hassan (benevolent loan) without obtaining a benefit, except for those who are truly seeking the reward from Allah.
Economic consequences
People are always looking for maximum interest rates. In the long-term, this can destroy the strength of the currency and the money supply in the economy.
When unable to repay the loan, one may resort to unfair or illegal means to payback, thereby corrupting the monetary system. Such acts of deceit may include stealing, bribing or cheating.
Widens the gap between the rich and the poor, thus accentuating the income disparity across the globe.
Spiritual consequences
Allah promises to destroy interest. Qur’an 2:276: “God destroys interest and gives increase for charities. And God does not like every sinning disbeliever.” Hence, the wealth accumulated through riba-based transactions will be devoid of barakah (blessings), despite any increase in the bank notes.
When one transgresses without taking heed of reminders, their heart becomes dead and they feel no regret upon sinning. Similarly, the one who engages in riba might feel a sense of guilt with their initial transactions. Nevertheless, satan gradually beautifies such misdeeds and hinders them from realizing the severity of the sin they are drowning in.
The Qur’an describes the punishment awaiting those who engage in riba on the day of Judgment in the most severe language, creating horrific scenes and frightening images in the minds of the readers. God says: Quran 2:275 “Those who consume interest cannot stand (on the Day of Resurrection) except as one stands who is being beaten by Satan into insanity…” Moreover, the sin of riba makes one susceptible for punishment in the grave, as well as in the barzakh. Besides, consuming riba means consuming haram (unlawful) wealth, a major reason that prevents one’s supplication from being answered. On the authority of Abu Hurayrah: The Messenger of Allah said, “God the Almighty is Good and accepts only that which is good…Then he mentioned the case of a man who, having journeyed far, is dishevelled and dusty, and who spreads out his hands to the sky saying “O Lord! O Lord!” while his food is haram (unlawful), his drink is haram, his clothing is haram, and he has been nourished with haram, so how can his supplication be a
nswered?” Allah only accepts that which is pure and lawful, and consuming riba is the complete opposite of that.
The fact that Riba is so widespread does not make it permissible. If it means renting a house or using your old car rather than buying a new one with interest, or giving up certain luxuries because the pleasure of Allah is dearer to you than any temporary worldly leisure, then go for it. You might struggle, but without a doubt, you will be rewarded immensely for every ounce of sacrifice you make.
God states in Quran 65:2-3“…And whoever fears God He will make for him a way out and will provide for him from where he does not expect. And whoever relies upon God, then He is sufficient for him…”
Today’s write up is especially geared towards further explanation of the prohibition of riba/usury/interest based on the Quran and sunnah. This is so because of the calls I had from some Muslim readers who wanted further understanding of the subject matter. I pray that this will be more beneficial to us and everyone who is concerned about this subject matter. May Allah give us better understanding of this subject matter and make us obey Him and His messenger and servant Muhamad, may the peace and blessings God be upon him, his family and companions. And Allah knows best!
YAHAYA ILIASU MUSTAPHA
The writer is an Islamic Banking and Finance patron and advocate in Ghana.
Email: yahaya0246873726@gmail.com
Facebook account: facebook.om/Yahaya.iliasu.94
0506218343 / 0246873726