Site Admin
Posts: 68
Joined: Thu Feb 04, 2021 1:44 pm

What does is interest and what is ribah?


What does is interest and what is ribah?


In the Name of Allah the Most Merciful and Kind.

Interest by definition means, “a charge for borrowed money”. This amount is generally a percentage of the amount borrowed.

Usury (Riba) also by definition means, “the lending of the money with an interest charge for its use (usually an excessive rate or amount of interest charged).

In Islam, all rewards must be the result of an effort. Both transactions lead to rewarding people without them making an effort. Additionally, both transactions lead to the concentration of wealth in the hands of a few and there is no equity. Since, both of these terms and be exchanged they are both haram.


Allah says in the Holy Quran:

Surah Al-Baqarah, 2:275: “Those who benefit from Riba shall be raised like those who have been driven to madness by the touch of the Devil; this is because they say: “Trade is like riba” while Allah has permitted trade and forbidden riba”. Hence those who have received the admonition from their Lord and desist may have what has already passed, their case being entrusted to Allah’ but those who revert shall be inhabitants of the fire and abide therein for ever”.

Surah Al-Baqarah, 2:278: “”Oh believers, fear Allah, and give up the riba that remains outstanding if you are believers”.

Surah Al-Baqarah, 2:280: “If a debtor is in hardship, then grant him time till it is easy for him to repay, but if you remit it by way of charity, that is better if you realize”.

The Prophet (p.b.u.h.) said: “A derham or riba, if a Muslim deals with it, it is bigger sin in Allah’s sight than committing Zina (adultery) with his mother in the Holy Masjid in Mecca”.

So, try to get an Islamic loan, Inshallah. If you cannot, be patient and sacrifice of that which Allah has given you. It is a great test. Remember that Allah is good and accepts only what comes from halal.

Allah knows best.

Sheikh Mostafa

Return to “Business and Finance”