What is ربا (Riba) according to the Quran?

Question

What is Riba according to the Quran? Please also state the verses in the Quran that hints to the term.

Answer 1

There is no clear-cut definition of what riba is in the Qur'an. The understanding based on the reading of verses is that, it is some form of an increase in a loan, that might end up doubling or quadrupling the debt, and that it is not to be confused with trade/sale. The ahadith are where you will find a more detailed explanation of the term.

There are four places in the Qur'an where Allah mentions usury:

[Surat al-Baqarah 2:275-76, 278-79] Those who swallow down usury cannot arise except as one whom the Shaytan has prostrated by (his) touch does rise. That is because they say: Trading is only like usury, while Allah has allowed trading and forbidden usury. To whomsoever then the admonition has come from his Lord, then he desists, he shall have what has already passed, and his affair is in the hands of Allah; and whoever returns (to it) - these are the inmates of the fire; they shall abide in it.

Allah does not bless usury, and He causes charitable deeds to prosper, and Allah does not love any ungrateful sinner.

O you who believe! Be careful of (your duty to) Allah and relinquish what remains (due) from usury, if you are believers.

But if you do (it) not, then be apprised of war from Allah and His Messenger; and if you repent, then you shall have your capital; neither shall you make (the debtor) suffer loss, nor shall you be made to suffer loss.

[Surah Ali `Imran 3:130] O you who believe! Do not devour usury, making it double and redouble, and be careful of (your duty to) Allah, that you may be successful.

[Surat al-Nisaa' 4:161] And for their taking usury though indeed they were forbidden it and for their devouring the property of people falsely, and We have prepared for the unbelievers from among them a painful chastisement.

[Surat al-Rum 30:39] And whatever you lay out as usury, so that it may increase in the property of men, it shall not increase with Allah; and whatever you give in charity, desiring Allah's pleasure - it is these (persons) that shall get manifold.

Answer 2

Riba, translated as interest or usury, is strongly forbidden in Islam to the extent that there is a declaration of war from God and His Messenger against the one who practices it (Holy Qur'an 2:278,279).

However, the concept of Riba is a lot wider than is commonly understood. The term Riba need not be restricted to any amount charged on cash, but can also mean any kind of excess given over and above any commodity. So any excess paid by a borrower of, say, wheat, to a creditor also implies riba.

If you think a little harder, riba is an anomalous charge that creates absurd situations in society. To take an instance, most nations today have central reserve banks (like the Fed in the United States) that retains the sole right to print currency. It then loans out these monies to banks with the understanding that the latter will return the same amount + interest on these monies. But since the central bank itself retains the right to create currency, there is no way that the banks will be able to return the interest amount except by getting it by fair means or fowl from the other banks (and the consumers). This fact itself is a losing proposition for any society that has a central bank as such.

Answer 3

I think there's another way to look at it, especially if you look at the principles mentioned throughout the Quran.

Riba meaning Increase

If you think about equity, justice, fairness mentioned throughout, it would suggest that it's not fair to increase one's wealth without some 'active work'. As phoenix mentioned in his quotes if I deposit some money and make a profit without putting effort in then it's obviously unfair. However if I make a loan to someone with the intention to make a profit based on some risk I've taken (of default), and analysis of the business etc, then I'm making effort and I will be duly recompensated.

That can then be applied much more widely to any kind of work. Wherever there is (free) reward without a risk then it's an increase in wealth without justification.

Answer 4

A Prelude to a Discussion on Riba (part 1 of 2) https://commentaryforhealing.blogspot.ca/2018/03/a-prelude-to-discussion-on-riba-part-1.html

Answer 5

Professor Farooq in this article makes a good case in a thorough scholarly analysis that riba was really the oppressive increasing (redoubling) of outstanding debt by moneylenders on poor debtors who could not repay their debt when due. The original markup was not riba. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1412753

The conclusion would be that reasonable interest in modern markets is not riba, but exploitive loan sharking and predatory lending on the poor is riba.

Answer 6

RIBA: According to The Holy Book Quran. Not limited to Muslims but this is for the whole humanity/universe. RIBA: Chapter 2 Verse 275,276,277,278 & 279.

2:275) Those who participate with others for profiteering from them instead of sense of caring and sharing for humanity they have no real basis to stand upon rather they have taken the same stand as of those who have been enslaved by the wicked ruler with ambitions and desires for power and wealth against the declared will of Allah. That is why they claim, hoarding for trading is same as hoarding for profiteering, but Allah has made trading for benefit of others lawful and profiteering at the expense of others unlawful. He who has received advice from his Lord and has mended his ways may keep his previous gains and Allah will be his judge in future as per his guidance. However those who keep going on the same way shall be companions of those who end up in agony wherein they will stay unless they repent or perish.     2:276) Allah has deprived hoarding for profiteering of goodness for humanity and instead blessed using what one can to help others with prosperity. And Allah supports not those who oppose or transgress against His declared will.   2:277) Those who commit to working for peace in the land and take appropriate actions whereby they establish divine rule in order to free mankind from all manmade ills, for them is great reward with their Lord that they will have nothing to fear or to regret once divine rule is brought into operation and is properly maintained.     2:278) O you who claim to commit to peace in the land! Be consistent with each other according to declared will of your Lord and therefore waive what is still due to you from others of profiteering if you have really committed to peace in the land between mankind;     2:279) And if you are not going to do as told then notice of war is hereby given to you by Allah and His Messenger. However, if you stop as of now hoarding for profiteering then you may have original whatever you are rightfully entitled to. Inflict no harm on others and suffer no harm from others.

Answer 7

[Surat al-Rum 30:39] And whatever you lay out as usury, so that it may increase in the property of men...

[Surah Ali `Imran 3:130] O you who believe! Do not devour usury, making it double and redouble...

According to these verse, that is "usury" and "increase in yhe property of MEN", it stated about usury that made an increasing of one's property. in another verse, by doubling or redoubling. So in my opinion there should be an usury, double/redouble increase in one's property. So what about government bank, that owned by a state not property of men?