RIBA – Worse Than Any Other Vice Neither Wrong Nor Be Wronged   What is riba? How bad is it? Why did Allah Almighty ban it? Finance is so complicated now. Aren’t times different now from then. Do the ayahs on riba still apply today? At the time the Qur’an was revealed, an atmosphere of greed and exploitation prevailed and society was steeped in ‘riba’. The ayahs prohibiting riba came as a massive shock and challenge to the community. It is still a challenge for us today. What is Riba? Riba literally means increase. Known widely as ‘interest’ and ‘usury’, it is the charge levied for ‘using’ money. In other words, it is where one party makes a profit through lending to another party. It is the increase of money without risk and without effort. Does Riba only apply to money? Riba can apply to any loan which brings benefit to the lender or has a gain tied in to it. It doesn’t have to be financial. Riba is when the lender gets his loan back AND MORE. How is Riba different from trade? People have argued since the revelation of these ayahs that riba is the same as trade. Allah Almighty, All Knowing rejects this argument. Money is not a commodity. It is not an object that is for sale. The paper it is printed is not worth anything itself. Profit should be linked to real business, whether it is the sale of a commodity or a service. Investments should have an element of risk as well as effort. In conventional lending, the return of the principal plus extra is guaranteed. By the time the original amount is returned the amount paid back could be many times the original sum loaned. In Islamic finance, the lender has a share in the … Continue reading The Issue with Riba