interest and islam

syedhassan · 02-18-2005, 05:43 AM

hello again...
here's some thinh about MODARBA....
ISLAMIC BANKING & MUDARABAH

Is there anything as "zero percent" banking? When an "Islamic" co-operative bank or a housing society purchases any article, commodity, property or the title against cash payment and then sells it at a higher price on credit as a "co-investor" or "sleeping partner", it is called "Mudarabah" (to sell at a profit). 'The Concise Encyclopedia of Islam', published by Harper & Law, Publishers, Inc., describes it as

To stay within the letter of the religious law and soothe consciences, some banks offer the solution of mudarabah (sleeping partnership) this defines the placing of capital as a co-investment, which naturally brings a return to both parties.
Some scholars call such arrangements as an alternative to Riba. Others, call it an attempt to circumvent the Riba. The proponents of the schemes may argue that since there is a trade agreement on the "new price", between the buyer and the seller, and the element of risk is involved as "co-investor", such transactions are Halal. Even "if" that be the case, how many such "zero percent" banks are there that can meet the needs of the Muslim families around the world? What about the other needs for borrowings, such as; the educational loans, medical emergencies, natural calamities, etc.? Who is responsible for the borrowings by the "Islamic States" that collects the Zakat money from its Citizens as their Trustees and also borrows large funds from the World Bank and/or International Monetary Funds, on "Interest"? It is recorded that even the Ottoman Banks used to charge and pay interest. What does that signify, to us?
Let the readers be the judge....
syedhassan...

ACCA

syedhassan · 02-18-2005, 05:46 AM

[/quote]
hi there...
the purpose to post the above by SAHIH AL_BUKHARI and the following material,
is just to make an openion and bringe good knowledge.
yes... its need extreme care, while translating THE HOLY QURAN and later interpreting the meanings...and (i also did the same...)
consulting at-least five well known english and urdu translations....
that is a good variety of sects...
and then, also some good narrations...
and then i pasted here, as i never want to post without research and confirmation...
and about, bieng difficult for over what so ever 1400 years...
i dont think its difficult for any of the muslims from current and future, as well...
as, we make it difficult on our own at times..
but,i think we make it difficult on our own mostly, as we are divided to DIFFERENT SECTS etc.. UNDER THE SINGLE HEAD OF ISLAM "THE RELIGION OF THE COMPLETE and TRUE BOOK AND HOLY PROPHET (S.A.W)"
i think, the COMMON mistake we make in translating correctly, is following a much WORD-to-WORD... approach.
and i thnk...,
, we need to, go into our hearts and KEEP FAILTH AND also, A HONEST COMMITTMENT in resolving any issue we desire to AND KEEP IN MIND THAT "the HOLY QURAN IS THE HOLY BOOK for ALL TIMES AND ALL PEOPLE

Here are SOME OF the verses on the subject of riba (usury)that i studied

Those who devour usury will not stand except as stands one whom the Evil One by his touch hath driven to madness. That is because they say "Trade is like usury but Allah hath permitted trade and forbidden usury. Those who after receiving direction from their Lord desist shall be pardoned for the past; their case is for Allah (to judge); but those who repeat (the offence) are companions of the fire they will abide therein (for ever) 2 275
O ye who believe! fear Allah and give up what remains of your demand for usury if ye are indeed believers. 2 278

O ye who believe! devour not usury doubled and multiplied; but fear Allah; that ye may prosper.
Yusuf Ali's translation. 3 130

O ye who believe! Devour not usury, doubling and quadrupling (the sum lent). Observe your duty to Allah, that ye may be successful.
M. Pickthall's translation 3 130.

O believers! Do not live on usury (compound interest) which is compounded over and over again. Have fear of Allah so that you may prosper.
(which is interest on an princpl+interest)
F. Malik's translation. 3 130

For the iniquity of the Jews We made unlawful for
them certain (foods) good and wholesome which
had been lawful for them; in that they hindered
many from Allah's way. That they (Jews) took usury though they were forbidden; and that they devoured men's substance wrongfully; We have prepared for those among them who reject faith a grievous punishment.
4 160 - 161

Note The Torah forbids the Jews from the devouring of Usury ("neshek"). See the Old Testament Ex. 22 25;
Le. 25 36-37; De. 2319-20; Ne. 5 7/10; Ps. 15 5; Pr. 288

The dilemma before the Ummah is NOT for the actual Command of Allah (s.w.t.) that prohibits the devouring of usury (riba) and/or for the strict condemnation of those who devour it. The dilemma in reality is concerning the correct definition of the term riba and its application, which is quite clear, FOR EVEREYONE, who SEEK THE GUIDANCE...

and i think, those who LAKE CARE AND honest COMMITTMENT, FAITH AND ALL ABOVE..,
comment in CRITICISM to THE HOLY QURAN and SUNNA and
SAHIH AL_BUKHARI.. (which many respect in bieng correct with its NARRATIONS)
do read the EXPERT OPENIOS (CRITICISM) by some what SCHOLARS here....

THE TIMING OF THE REVELATION 

The following... so called excerpts from the commentaries to the above verses speak of the timing of the Revelations and the lack of opportunity for acquiring the knowledge of its Shar'i implications, from the Prophet

The commentary # 324 to verse 2 275, by Abdullah Yusuf Ali

Usury is condemned and prohibited in the strongest possible terms. There can be no question about the prohibition. When we come to the definition of Usury there is room for difference of opinion. Hadhrat 'Umar, according to Ibn Kathir, felt some difficulty in the matter, as the Apostle left this world before the details of the question were settled. This was one of the three questions on which he wished he had more light from the Prophet.
The commentary # 35 to verse 30 39, by Scholar Mohammad Asad
Mohammad Asad writes; In the words of Ibn Kathir (in his commentary on 2 275), "the subject of riba is one of the most difficult subjects for many of scholars (ahl al-'ilm)". It should be borne in mind that the passage condemning or prohibiting riba in legal terms [{2 275-281}] was the last revelation received by the Prophet, who died a few days later [cf. note [268] on 2 281; hence the Companions had no opportunity to ask him about the Shar'i implications of the relevant injection - so much so that even 'Umar ibn al-Khattab is reliably reported to have said "The last [of Qur'an] that was revealed was the passage [lit., "the verse"] on riba; and, behold, the Apostle of God passed away without [lit., "before"] having explained its meaning to us" [Ibn Hambal, on the authority of Sa'id ibn al-Musayyab].

regards..
syedhassan...

ACCA
[/quote]

ACCA

Shahid_fss · 02-27-2005, 11:04 AM

Hi guys
Sorry I can't read the whole topic as it is too long.

The question was about "riba" when there is inflation
Islamic economy is built upon many things not just on interest. If we take a model Islamic economy then weâll see that there are no extra spending, no black money to spend on, equal distribution of wealth (through zakat and taxes), no costly (useless) imports to spend on, simple living so no high demand, fair business and trade so no problem in supply, hardworking and sincere people so no foreign aid, followers of Islam so no crimes, volunteer army as used by Muhammad PBUH so low defense budget (just for weapons) and so on. If you compare all these things with the theory of inflation, you will see that all these things reduce inflation and keep the value of money and prices same at small changes. When there will be no inflation at all then we should not worry about interest.

Even then partnership on profit and loss sharing basis can be carried on.

There is no question, as all of us agree, that riba/interest is haram and we should as much as we can stay away from it.

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Shahid_fss · 02-27-2005, 11:10 AM

High inflation is the punishment for our luxurious life style where some are sleeping on notes and others have nothing to eat.
Is it fare to escape from a punishment with the help of another sin?

========================
```*``` I love stars;
*`*`*`* Shining;
`*`*`*` and Smiling;
*`````* Always.
------------------------
[email protected]
http//www.shahid-fss.tk
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Goodman · 02-27-2005, 06:59 PM

Shahid

The economic structure you mentioned is text book only. Even in the first 50 years there were clear deviations on almost every matter you mentioned.

Whilst I agree that int. is haram, I believe its haram in the hands of receptiant and the other area is grey. Now you try to variate it by saying well int. on Imanat and all that is different, thats your viewpoint but I believe its in direct conflict with the regulations.

The clear guidance is not available on this subject and the people who could have provided clear guidance are either quite or powered by their own personal objectives.

Hamim · 03-05-2005, 04:42 AM

If someone takes interest according to the quran is waging a war against Allah(swt)and the ayah in surah al baqrah which talks about interest is the longest ayah of the quran. I think other posts have done a good job in clarifying the concept in general. I can tell you one thing for sure according to kensian econ theories, interest is the reward for parting with liquidity for a particular period . The way our economic systems work have an assumption of interest based models.
Inflation is one of those assumtions , therefore if some thing is haram we should aviod it. It would be a fruitless debate to justify the concept of modren intested which is much more than just usury....

Regards
Hamim

Abe · 03-11-2005, 01:01 AM

There is no doubt that interest is haram, I have just been reading a very insightful and enlightening articles on islamic-finance.com by Tarek El Diwany. I would suggest that anyone wishing to gain an understanding the principlas of Islamic Finance look at the articles posted in the editorial. I do not know anything about El Diwany other than what info is given about him on the website but he appears to have a very good grasp of finance and how it relates to islamic principles. He has also written a book the Problem with Interest. A recommended read for anyone wishing to know more about interest and islam.

noman · 03-18-2005, 08:28 AM

((A)))
i have another thing to say..
i heard that those that will be punished include

1-reciever of interest(usury/riba)
2-payer
3-one who writes the interest

what would u guys comment on that/
((B))
another thing is..

like nowadays......people "invest" the money they previously had in saving accounts in property..
they know that they will buy it in,say ,100 and sell in 150 one week later.....
they don't take risk......and also benefit from wealth by utilizing it obtain property and sell it to those who couldn't buy it due to lack of money......in other words....u are exploiting ur position of having "excess" money.

((C))

what is difference between "investment" in commodities of which u are sure that their prices will increase u will get extra revenue
and
"deposits" of money in banks to earn revenue of which u are sure....?
in both cases u are risk free and exploiting ur excess cash reserves...

((D))
do chartered accountants or other ppl with jobs in monetary or finance sectors come under the description of " one who writes interest" as mentioned in part A??

Pracs · 04-14-2005, 08:48 PM

Yes a Book of guidance that needs to be understood and then implemented in its true form and not just the substance, When Quran was revealed there was no paper money. A whole lot of trade was done through barter arrangements, a lot of valuables like silver, gold and precious stones were used for larger payments.

So the million zillion dollar question here is, what do we do about the inflation ? paper money backed only partly by precious metals/reserves. Back to the drawing board and Dr. M's model of the Islamic Dinar.

Lion King since you are a student of accountancy you must be familiar with '' the substance over form'' ratlings we accountants do all the time. Let me give you an example its is premissable to own shares on the stock market right ? but you could be a damn big speculator (or a cartel of them) bringing the KSE to its knees every time you see a profit in the making. Now that is un islamic, getting into stuff like insider dealing, that is un islamic. Not paying your taxes (and trading in smuggled goods) that is un islamic. Drug and human trafficking is un islamic.

A Pensioner or widower living on the interest from his/her Defence or National savings, is I hope not un islamic. Getting your pension from a Fund based on interest based investments... I hope is not un Islamic.

Sorry to have tread on any body's toes here,,, but I see at things a little different. Its just not black and white,.. this is some thing in the grey!

Pracs · 04-19-2005, 07:20 AM

I am sorry that I took you for an accountancy student, so what do you propose the widow do ? is the state going to look after her, will she be given a job? Can she trust any joe bloke on the street with her money to invest in business ? well, what's the point !.

Pracs · 04-19-2005, 07:32 PM

Lion King, Thank you for turning your CAPS off, even if its just in this thread. Appreciate your respect for other members....hey isn't that some thing that falls in the perview of Haqooq Al Abad ?

No comment on the main issue as promised

"Allah does not change the state of people unless they change what is within themselves" Quran 1311

Azeem Shah Khan · 04-29-2005, 07:56 AM

If we start doing things the way they used to be done some 1400 years back then i expect you to travel on camels and so on.

The issue is not if Interest is Halal or not but WHAT IS INTEREST? is it RIBA or something else. The problem is you take things on face whereas Quran repeatedly asks its readers for detailed understanding. You must have read verses like "Aur is mein aqal rakhney waaloon ke liye bari nishaaniyaan hain".

Lastly stop imposing fatwaas, you are not a mufti. Follow whatever you feel like, you have the right for it but do understand that everybody has got the same right too.

May Allah bless all of us

Regards

"You don't get to choose how you're going to die. Or when. You can only decide how you're going to live. Now."

Shahid_fss · 04-30-2005, 05:09 AM

<blockquote id="quote">quote<hr height="1" noshade id="quote">The issue is not if Interest is Halal or not but WHAT IS INTEREST? is it RIBA or something else. The problem is you take things on face whereas Quran repeatedly asks its readers for detailed understanding. You must have read verses like "Aur is mein aqal rakhney waaloon ke liye bari nishaaniyaan hain".[/quote]

Oho 11 pages key baad bhi yeh faisla nahi hua.

I advice you that one of us who is best in Islamic studies will post the definition of RIBA and one who is good in Accounts will post the definition of INTEREST. 
When both definitions will be infront of us, we will make difference between them.
<ul>
<li>If interest is same as riba then its haran.</li>
<li>If its defferent then we'll decide how to treat it.</li>
</ul>
But first of all we should know that interest and riba are same or not.

Agree?

Azeem Shah Khan · 04-30-2005, 06:40 AM

<blockquote id="quote">quote<hr height="1" noshade id="quote">Oho 11 pages key baad bhi yeh faisla nahi hua.<hr height="1" noshade id="quote"></blockquote id="quote">

Because this is an area that needs detailed understanding. Some of us did mention this fact on earlier pages that this topic cannot be concluded by way of discussion alone.

What i infer from this 11 pages long discussion is that we have two groups of members

1. Who blindly follow/want to follow the religion/Quran without any flexibilty as they consider it to be a clear deviation from the words of God. Whether they are right or wrong is a separate debate.

2. Who believe in Quran exactly like others do but they want to know the truth, rationale and logic behind it to understand what Quran is actually saying about that topic.

Kind regards

"You don't get to choose how you're going to die. Or when. You can only decide how you're going to live. Now."

Pracs · 04-30-2005, 09:36 PM

I couldn't have put it better myslef, agree with you Azeem, all the way. Yes a lot of people just seem to hear a chant and if they think its anyway related to Quran they do not even want to verify it for themselves. As Educated muslims we have one added responsibilities, which is to think and act on the level of the community/ society. Just claiming that ''I will not get associated with an interest based accounting system'' is just not enough. The question is can every body else do that ? What happens to the society at general. Or do we still want to go with the ''holier than thou'' image. If we do, its a shame.

I some time feel that a lot of people here are students, not yet out into the real world ! where ofcourse the realities are different and so are the problems and the solutions !! I don't blame them I was a student once, so.

"Allah does not change the state of people unless they change what is within themselves" Quran 1311