Riba: The Principle, the Contract, and the Modern Economy
There is a question about riba that deserves more careful discussion. Not because the Qur'an is unclear about its prohibition. It is not. The question is: what exactly is the economic relationship that the Qur'an calls riba, and how should we understand it when the entire financial structure of the economy has changed? What does the Qur'an actually say about riba? The Qur'an does not give us a simple dictionary definition of riba. Instead, it describes the practice and draws a clear distinction between trade and riba: “Allah has permitted trade and forbidden riba.” In Qur'an 2:275–280, the discussion is centred on debt. The creditor is entitled to the principal, while any additional claim is rejected, with the instruction that neither party should wrong the other. The Qur'an also refers to riba as being “multiplied and multiplied,” in a context connected with debt. So, at its most basic level, the Qur'anic picture is of a debt whose claim increases beyond th...