Interest

In Islam, the concept of interest, or Riba, is strictly prohibited. Riba refers to any guaranteed profit or benefit derived from lending money or capital that is paid over and above the principal amount, often in the form of interest charges. This practice is considered unjust and exploitative, as it involves charging someone for borrowing money, regardless of their financial situation or the risks they face. 

The prohibition of Riba is grounded in the teachings of the Qur’an and the Hadith (sayings of the Prophet Muhammad, peace be upon him). Allah (SWT) condemns Riba because it leads to exploitation, inequality, and social injustice. It is seen as a form of financial oppression, where the lender benefits without risk, while the borrower is burdened by debt, often with no consideration of their ability to repay. 

Qur’anic Guidance on Riba 

In Islam, Riba is prohibited as it goes against the core values of justice, equity, and compassion. The focus is on creating a financial system that encourages risk-sharing, ethical wealth creation, and social welfare, while ensuring that no one is exploited or burdened by unjust debts. By adhering to these principles, Muslims aim to create a more just and equitable society where wealth is used for the benefit of all, not just the few. 

In the Qur’an, Allah (SWT) makes His stance on Riba clear, warning against engaging in such practices: 

“O you who have believed, do not consume Riba, doubled and multiplied, but fear Allah that you may be successful.” 

(Surah Al-Imran, 3:130)