The Moral Context of the Prohibition of Riba in Islam Revisited

Abstract

The prohibition of riba (interest) in Islam has been a hotly discussed
issue among contemporary Muslims since the 1960s. Since rihd is perceived
by a considerable number of Muslims to be bank interest, and
almost all banking systems in the world, including those of the Muslim
world, are based on interest, many Muslims are concerned whether it is
lawful. For those who regard bank interest as rihd, any increase in a loan
transaction over and above the principal is rihd because it involves an
increase over and above the principal. They contend that the fiqhi interpretation
of riba is the interpretation and must be followed. For other
Muslims, the prohibition of riba is related closely to the “exploitation” of
the needy and poor by the relatively well-off, an element that, for them,
may or may not exist in modem bank interest. These Muslims have argued
that the fiqhi interpretation given to riha is inadequate and does not take
into consideration the moral emphasis associated with the prohibition.
This paper looks at a) the overall context of the Qur’anic prohibition
of rihd; b) how the term is used in the Qur’an, the Sunnah, and in thefiqhl
literature; and c) the lack of moral emphasis in the current debate.
Riba and the Qur’an: The Context of Prohibition
The Qur’an’s condemnation and ultimate prohibition of riba was preceded
by its condemnation of several other morally unacceptable forms of
behavior toward the socially and economically weaker strata of the
Makkan community. From the very beginning of the Prophet’s mission, ...