Caught in the Trap of Usury

‘Riba’ is an Arabic term that signifies excess, increase, or addition. In the Quran and Hadith, it specifically refers to 'usury' or ‘interest.’ Riba comes in various forms. To better understand riba in the context of Islamic banking and finance, consider this example: If someone loans a sum of money to another person and requires the borrower to repay the loan along with an agreed-upon additional amount within a set time frame, this extra or additional amount is considered riba.

In the present era, the most rapidly spreading trend in Kashmir is the practice of usury, including usurious transactions, trade, and dealings. Today, most commercial buildings, hospitals, educational institutions, shops, residential houses, and vehicles are financed through interest-based loans. People are being driven to suicide due to their inability to repay these loans.

The lack of timely arrangements for the repayment of instalments leads to depression, property auctions, and harassment by bank officials. The increasing interest rates are devastating countless lives, and our entire society is falling prey to the destruction caused by usurious transactions.

This is why we have decided to raise awareness among our people every Friday about the destruction caused by usury, drawing on the teachings of the Quran and Sunnah as well as day to day experiences. Usury is a sin that leads to destruction, and engaging in usurious transactions is so heinous and detestable in the eyes of Shariah that Allah Almighty has declared it as a declaration of war against Allah and His Messenger (peace be upon him) in the Holy Quran.

The ultimate outcome of usury is nothing but destruction and devastation. The severity of usurious dealings can be understood from the fact that the curse of this sin is not limited to just the two individuals directly involved; rather, all those who assist in any way, such as the one who writes the contract or the witnesses, also become deserving of Allah's curse and are deprived of His mercy.

In summary, according to the Quran and Hadith, engaging in usurious transactions is strictly forbidden. In Islam, just as it is forbidden to take interest, it is equally forbidden to give it, and severe warnings have been mentioned in the Hadith for both. Usurious transactions lead to destruction and ruin in both this world and the hereafter, resulting in humiliation, disgrace, and poverty. Often, those who take loans on interest to start a business spend their entire lives trying to free themselves from the burden of interest. Many times, they end up losing their entire capital and profit. Therefore, entering into usurious contracts and taking loans based on interest is not permissible. Every individual must protect themselves not only from interest but even from situations that might resemble usury.

Jabir (ra) said that Allah's Messenger C cursed the accepter of interest and its payer, and one who records it, and the two witnesses, and he said: They are all equal. (Muslim 4093)

The Harms of Usury: 

Usury (interest) is a form of unfair exchange that weakens human emotions and relationships. It plants the seeds of resentment and hostility in people's hearts. Usury undermines the bonds of cooperation between individuals and nations. As a result of usury, borrowers sometimes resort to suicide, or, overwhelmed by extreme distress, they may even dangerously kill the usurer. Usury can lead to collective crises, widespread chaos, and even public revolts. Nations that see their wealth being transferred into the pockets of others in the name of interest will view those usurers with pure hatred and animosity. From a moral perspective, usury leaves a profound impact on the minds and hearts of the borrowers.

Allah Almighty has declared usury forbidden for Muslims. Those unfortunate individuals who continue to engage in usurious transactions, despite knowing this, are essentially waging war against Allah and His Messenger. Anyone who denies its prohibition is considered a disbeliever, and those who acknowledge its prohibition but still fall into this sin are considered disobedient.

Indeed, life is concise and uncertain. When we depart from this world, our possessions will be passed on to others. So, while living in this fleeting world, let us engage in righteous deeds and remember death frequently. It is in our best interest to follow the commands of Allah Almighty and His Messenger and to remember death often.

May Allah, the Lord of Glory, grant our community deliverance from this curse.

Maulana Manzoor Ahmed Qasmi is Shaikh ul Hadith Ashraf ul Uloom Hyderpora, Srinagar