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HOME / ISLAMIC DONATIONS / Interest (Riba) in Islam

Interest (Riba) in Islam

Here's a quick guide on how to donate your interest earnings to MAA via our online donation system. Donate your interest earnings.

Interest (Riba) in Islam: Understanding its Prohibition and Ethical Financial Alternatives

The concept of 'Riba' in Islam is not merely a financial term but a principle that guides the economic ethics of Muslims. With its roots in the Arabic language, 'Riba' translates to 'excess' or 'increase,' and in the Islamic Shari‘ah, it pertains to the prohibited practice of conducting financial transactions associated with interest.

The Prohibition of Riba: An Explicit Command

Yes, Islam strictly forbids Riba in all its forms, equating its practice to a severe transgression against the faith. The Quran, the holy book of Islam, and the Prophet Muhammad (Peace Be Upon Him) have explicitly and categorically condemned the consumption, imposition, and practice of Riba.

The Ethical Rationale Behind Prohibiting Riba

The prohibition of Riba is deeply rooted in the ethical and moral framework of Islam. It is seen as a mechanism that perpetuates wealth within the wealthy, creating a direct, unearned dividend from the wealth of the impoverished, thereby perpetually impoverishing them. Allah has classified loans (qard) as a form of charity (sadaqah), meant to be given freely to assist those in need, and making money from such acts of charity is deemed immoral.

The Quran and Riba: A Clear Stance

The Quran explicitly forbids Riba in various verses, highlighting its severe consequences in the Hereafter and its detrimental impact on societal welfare. The prohibition is not only categorical but also comes with a stern warning of a grievous penalty for those who engage in it.

The Prophet Muhammad (PBUH) and His Teachings on Riba

Prophet Muhammad (PBUH) has spoken extensively about Riba, illustrating its dangers and the severe punishment awaiting those who indulge in it. From being categorised as one of the "seven deadly deeds" to being associated with severe consequences in the afterlife, the Prophet’s teachings underscore the gravity of engaging in Riba.

The Historical Context: Riba Before Islam

Riba was not only prohibited for Muslims but also for communities before them. The Heavenly Books preceding the Quran also categorically prohibited Riba, and punishments were meted out to communities that engaged in it, as a means to eradicate economic injustice and promote equitable wealth distribution.

Ethical Financial Alternatives in Islam

Islam doesn’t merely prohibit Riba without providing alternatives. The financial ethics of Islam encourage trade, investment, and charitable giving, promoting a system where financial help is provided without exploiting the need of the recipient. Zakat, one of the pillars of Islam, is a system that ensures wealth circulation among all societal segments, ensuring no one is left in destitution.

MAA Offers You A Way To Cleanse Your Interest Earnings

In the modern financial landscape, even the most cautious may inadvertently accrue interest earnings, which are not permissible in Islam. Muslim Aid Australia (MAA) recognises this challenge and provides a practical solution for those who find themselves in possession of unsolicited interest earnings from various banking institutions.

  • Purifying Wealth through Ethical Means

    • MAA has established a method for you to purify your wealth by facilitating a way to dispose of these interest earnings ethically and in compliance with Islamic principles. It's crucial to note that while this act does not yield any spiritual reward, as it involves disposing of impermissible gains, it does ensure that your remaining wealth is cleansed and halal.‚Äč

  • How You Can Cleanse Your Interest Earnings

    • If you find yourself with interest earnings and wish to cleanse your wealth, navigate to our Interest Cleansing donation page. MAA ensures that these funds are utilised in ways by directing them towards activities and expenses that align with the ethical disposal of such funds, ensuring your adherence to Islamic financial ethics.



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