The Shar’ee implications of being associated with a riba-based institute

Q: Why is it impermissible in shariah to take interest bearing loans from the bank?

A: The conventional bank, which in reality is a riba-based system, is aimed towards enslaving man to his carnal desires through the agency of providing him with loans on interest. Many people, due to their naivety and limited understanding, view the ‘benefits’ and ‘privileges’ afforded to them by the bank (OD facility, etc.) as a means of their progress and advancement, only to realise at the end that they have been entrapped in the snare of Shaitaan.

The outcome of these loans is that one will live beyond his means, labouring under the misconception and fallacy that the bank will always aid him and be at his side in his hour of need. The pitiful result is that one eventually finds himself drowning in a sea of debts, enslaved to the conventional banks in a never-ending effort to pay off the interest on the loan which in many cases, eventually exceeds the actual loan.

Islam has strongly condemned this inhumane system in such unequivocal and categorical terms that no other evil has been condemned so strongly in the Holy Qur’aan. Allah Ta`ala says:

یٰۤاَيُّهَا الَّذِينَ اٰمَنُوا اتَّقُوا اللّٰهَ وَذَرُوا مَا بَقِىَ مِنَ الرِّبٰۤوا إِن كُنتُم مُّؤْمِنِينَ﴿٢٧٨﴾ فَإِن لَّمْ تَفْعَلُوا فَأْذَنُوا بِحَرْبٍ مِّنَ اللّٰهِ وَرَسُولِهِ ۖ وَإِن تُبْتُمْ فَلَكُمْ رُءُوسُ أَمْوَالِكُمْ لَا تَظْلِمُونَ وَلَا تُظْلَمُونَ ﴿البقرة: ٢٧٩﴾

O you who believe, fear Allah and give up all interest dealings, if you are believers. But if you do not desist from it, then be informed of a war against Allah and His Rasul (sallallahu ‘alaihi wasallam). However, if you repent, then you will be allowed to take back your capital; do not deal unjustly, and you shall not be dealt with unjustly.

Hazrat Abdullah bin Hanzalah (radhiyallahu ‘anhu) reported that Rasulullah (sallallahu ‘alaihi wasallam) said:

عن عبد الله بن حنظلة غسيل الملائكة رضي الله عنه قال قال رسول الله صلى الله عليه وسلم درهم ربا يأكله الرجل وهو يعلم أشد من ستة وثلاثين زنية (مسند أحمد رقم 21957)

“Consuming one dirham of riba knowingly is worse than committing zina thirty-six times.”

On the occasion of the farewell pilgrimage, Rasulullah (sallallahu ‘alaihi wasallam) declared:

قال رسول الله صلى الله عليه وسلم إن دماءكم وأموالكم عليكم حرام كحرمة يومكم هذا فى شهركم هذا فى بلدكم هذا ألا إن كل شىء من أمر الجاهلية تحت قدمى موضوع … وربا الجاهلية موضوع وأول ربا أضعه ربانا ربا عباس بن عبد المطلب فإنه موضوع كله (سنن أبي داود رقم 1907)

“Indeed, your life and wealth are sacred upon you like the sanctity of this day, in this auspicious month, in this blessed land. Remember! All pre-Islamic ways and practices (against the Deen of Islam) are abolished beneath my feet…. All interest dealings which used to take place in the pre-Islamic era (jaahiliyyah) are abolished in Islam. The first debt of riba that I abolish is the riba owed to my uncle, Abbas ibn Abdil Muttalib (radhiyallahu ‘anhu).”

And Allah Ta’ala (الله تعالى) knows best.

Answered by:

Mufti Zakaria Makada

Checked & Approved:

Mufti Ebrahim Salejee (Isipingo Beach)

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