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    Why Usury Is Haram

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    Khaleel Ullah
    The document discusses why usury (riba) is forbidden (haram) in Islam. [1] Several Quranic verses forbid usury and describe its negative consequences. [2] The Prophet Muhammad also cursed those who pay or receive interest. [3] Islam prohibits interest to encourage economic activity rather than dependence on loans, promote compassion over exploitation of the needy, and prevent the rich from oppressing the poor through debt.

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    Why Usury Is Haram

    Uploaded by

    Khaleel Ullah
    125 views3 pages
    The document discusses why usury (riba) is forbidden (haram) in Islam. [1] Several Quranic verses forbid usury and describe its negative consequences. [2] The Prophet Muhammad also cursed those who pay or receive interest. [3] Islam prohibits interest to encourage economic activity rather than dependence on loans, promote compassion over exploitation of the needy, and prevent the rich from oppressing the poor through debt.

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    Why Usury is Haram

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    The document discusses why usury (riba) is forbidden (haram) in Islam. [1] Several Quranic verses forbid usury and describe its negative consequences. [2] The Prophet Muhammad also cursed those who pay or receive interest. [3] Islam prohibits interest to encourage economic activity rather than dependence on loans, promote compassion over exploitation of the needy, and prevent the rich from oppressing the poor through debt.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOC, PDF, TXT or read online from Scribd
    Download as doc, pdf, or txt
    125 views3 pages

    Why Usury Is Haram

    Uploaded by

    Khaleel Ullah
    The document discusses why usury (riba) is forbidden (haram) in Islam. [1] Several Quranic verses forbid usury and describe its negative consequences. [2] The Prophet Muhammad also cursed those who pay or receive interest. [3] Islam prohibits interest to encourage economic activity rather than dependence on loans, promote compassion over exploitation of the needy, and prevent the rich from oppressing the poor through debt.

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    BAHRIA UNIVERSITY ISLAMABAD

    Why is Usury Haram?


    Submitted By
    Khalil Ullah Mohammad
    01-120082-026
    9/28/2010

    Submitted To
    Mrs Huma Ayub
    Why Riba (Usury) Is Haram

    “Those who devour usury 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 usury,” but God 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 God (to judge); but those who repeat (the offence) are

    companions of the Fire: They will abide therein (for ever).”


    - Quran Verse 2:275 (Chapter Al-Baqara)

    The term, “riba” technically refers to the premium that must be paid by the borrower to the

    lender along with the principal amount as a condition for the loan or for an extension in its

    maturity. Since the Qur’an and hatith is the undisputed source of guidance in Islam for all

    Muslims, there is unanimous agreement on the fact that Islam has forbidden the practice of riba.

    In several verses of the Holy Qur’an, Allah (swt) has mentioned the consequences of riba.

    “That they took riba (usury), through they were forbidden and that they devoured men’s

    substance wrongfully – We have prepared for those among men who reject faith a grievous

    punishment.” (4:161)

    Further it is stated,

    “O ye who believe! Devour not usury doubled and multiplied; but fear Allah, that ye may (really)

    prosper.” (3:140)

    The Prophet (saw) have cursed the receiver and the payer of interest and the one who records it

    (the contract) and the two witnesses to the transaction and said, “They are all alike (in guilt)”.
    The strict prohibition of Interest in Islam is a result of its deep concern for the economic, moral,

    and social welfare of mankind.

    Economic: Dependence on interest discourages people from working/trading to earn money and

    the value of work/trade is reduced. Such people won’t bother to take the trouble of running a

    business or risking money in trade/industry.

    Moral: Acceptance of Usury discourages people from doing good to one another and lend out of

    good will. A society which encourages interest on lending will require needy people to pay back

    more than he borrowed, which quite often is a source of huge burden.

    Social: If interest is allowed, the rich (who are most likely to be lender) will exploit the poor

    (borrower). As a result, the rich becomes richer and the poor becomes poorer. This generates

    envy and hatred among the poor toward the rich, resulting in social disorders, conflicts and at

    times breeds revolutions & movements.

    According to my view the reason behind forbidding riba is clear because it is thought to be

    exploitive. It is consuming the belongings of people without legal right. It also gives the rich

    people monopoly of all the money and does not help the poor. Also, giving loans with interest

    results in hatred and enmity between people and it causes severing of relations between them.

    Islam calls for unity while Riba causes disunity in the single Muslim Ummah. Islam also urges

    rich people to be compassionate towards poor ones while Riba results in the opposite.

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