Lecture 2

Riba - Interest
 Issue to be discussed
Interest HARAM – clear ayat of Qur’an

Interestin a controlled environment

The consequence of interest on the society
Conclusion – is interest desirable ?
Recent developments & the rise of Riba-
based intuitions
The future of Riba . . .
What the Qur’an DECLARES (2:275):
Those who eat Ribâ (usury) will not stand (on the Day of
Resurrection)

except like the standing of a person beaten by Shaitân (Satan)

leading him to insanity.

That is because they say:

"Trading is only like Ribâ (usury),"

whereas Allâh has permitted trading and forbidden Ribâ.

So whosoever receives an admonition from his Lord

& stops eating Ribâ (usury)
shall not be punished for the past;
his case is for Allâh (to judge); but whoever returns (to Ribâ),
such are the dwellers of the Fire – they will abide therein
forever.
Soorah Al-Baqarah Ayah # 276:
Allâh will destroy Ribâ (usury)

and will give increase for Sadaqât (deeds

of charity, alms, etc.)

And Allâh likes not the

disbelievers, sinners.

RIBA will be DESTROYED !!!!!!

Soorah Al-Baqarah Ayah # 277:

1. Truly those who believe,

2. and do deeds of righteousness,
3. and perform As-Salât,
4. and give Zakât,

they will have their reward with their Lord.

 On them shall be no fear,

 nor shall they grieve.
 Soorah Al-Baqarah Ayah # 278:

O you who believe! MUST

give
Be afraid of Allâh up riba!
and give up what remains
(due to you) from Ribâ
(from now onward),

if you are (really) believers.

Soorah Al-Baqarah Ayah # 279:
And if you do not do it,

then take a notice of war from

Allâh and His Messenger;

but if you repent,

you shall have your capital sums.
Deal not unjustly (by asking more
than your capital sums),
and you shall not be dealt with
unjustly (by receiving less than
your capital sums).
 Soorah Al-Baqarah Ayah # 280:
And if the debtor is in straitened
circumstances,

then (let there be) postponement

to (the time of) ease;

and that ye remit the debt as

almsgiving would be better for
you if ye did but know.
 Soorah Al-Baqarah Ayah # 281:

And be afraid of the Day when

you shall be brought back to
Allâh.

Then every person shall be

paid what he earned, and they
shall not be dealt with
unjustly.
Ahadeeth on RIBA:
Anas ibn Malik (r) narrates that the Prophet (s), said:
"Deceiving a mustarsal [an unknowing entrant into the market]
is riba."
(Suyuti, al-Jami' al-Saghir, under the word ghabn; Kanz al-'Ummal, Kitab al Buyu, al-
Bab al-thani, al-fasi al-thani, on the authority of Sunan al-Bayhaqi).

Abu Hurairah (r) narrates that the prophet (s) said:

On the night of Ascension I came upon people whose
stomachs were like houses with snakes visible from
the outside. I asked Gibril who they were. He replied
that they were people who had received riba.” (Musnad
Ahmed & Ibn Majah:Kitab al-Tijarat, Bab al-taghlizi fi al-riba)

Abu Hurairah (r) narrates that the prophet (s) said:

There will certainly come a time for humanity when
everyone will take riba and if he does not do so, its
dust will reach him (Abu Dawoud)
Ahadeeth on RIBA:
Jabir (r) narrates that the prophet (s) cursed the receiver
and the payer of riba, the one who records it and the
2 witnesses to the transaction and said: “They are
all alike” (Tirmidhi)

Similar to the hadeeth of Alcohol:

Anas ibn Malik (r) narrates that Allah's Messenger (s):
Cursed ten people in connection with wine:
the wine-presser, the one who has it pressed, the one who drinks
it,
the one who conveys it, the one to whom it is conveyed,
the one who serves it, the one who sells it,
the one who benefits from the price paid for it,
the one who buys it, and the one for whom it is bought.
(Tirmidhi (Hadith # 2776 ) & Ibn Majah)
Ahadeeth on RIBA (contd):
Abu Sa'id al-Khudri(r) narrates that the Prophet (s),said:
"Gold for gold, silver for silver, wheat for wheat, barley for
barley, dates for dates, and salt for salt - like for like, and
hand-to-hand.
Whoever pays more or takes more has indulged in riba. The
taker and the giver are alike [in guilt]."
(Musnad Ahmed & Muslim: Kitab al-Musaqat, Bab al-sarfi wa bay'i al-dhahabi bi
al-waraqi naqdan).

'Abdallah ibn Abi Awfa (r) narrates that the Prophet (s), peace
be on him, said: "A najish [one who serves as an agent to bid
up the price in an auction] is a cursed taker of riba."
(Cited by Ibn Hajar al-Asqalani in his commentary on al-Bukhari Suyuti, al-
Jami al-Saghir, under the word al-najish and Kanz al-'Ummal, op. cit.,
both on the authority of Tabarani's al-Kabir).
Ahadeeth on RIBA (contd):
Jabir ibn 'Abdallah (r) narrates that on the Prophet (s) in the Farewell
Pilgirmage, said:
"All of the riba of Jahiliyyah is annulled.
The first riba that I annul is our riba, that accruing to 'Abbas ibn 'Abd al-Muttalib
[the Prophet's uncle]; it is being cancelled completely."
(Musnad Ahmed & Muslim: Kitab al Hajj, Bab Hajjati al-Nabi (s)).

'Abdallah ibn Hanzalah (r) narrates that the prophet (s), said:
"A dirham of riba which a man receives knowingly
is worse than committing adultery thirty-six
times."
(Mishkat al-Masabih, Kittab al-Buyu', Bab al-riba, on the authority of Ahmad and
Daraqutni). Bayhaqi has also reported the above hadith in Shu'ab al-iman with

"Hell befits him whose flesh has

the addition that

been nourished by the unlawful"

(Musnad Ahmed & Muslim: Kitab al Hajj, Bab Hajjati al-Nabi (s).
Categorizations of RIBA
Riba An-
Nasi’ah

Riba Al-Fadl
 Is RIBA Haram in Islam
It is a serious kabair; if not left in hell-
fire forever

It is clearly haram in Qur’an & hadith

Thereis absolutely no difference

amongst the Fuqahah on Riba

It is a sin in Judaism & Christianity

Itis not considered a good practice in

Hinduism, Buddhism, or Maoism
 Views on RIBA/INTEREST
Plato disliked it – “Anti-human”

Aristotle condemned it

Early Roman Empire prohibited it !

Lex Genucia of Rome – Illegal (340BC)

Federal Shariat Court – Anti Islamic

Federal Shariat Court-Contrary to Islam
Government Savings Banks Act 1873
The Interest Act 1839
The Code of Civil Procedure, 1908
The Co-operative Societies Rules, 1927
The Negotiable Instruments Act, 1881
The Land Acquisition Act, 1894
The State Bank of Pakistan Act, 1956
The Insurance Act, 1938
The West Pakistan Money Lenders Rules,
1960
The Co-Operative Societies Act, 1925
(Banking & Finance (For BCom, Part 1), Prof M Amin Khalid, Karachi 2002)
Federal Shariat Court-Contrary to Islam
The West Pakistan Money Lenders Ordinance,
1960
The NWFP Money Lenders Ordinance, 1960
The Punjab Money Lenders Ordinance, 1960
The Sindh Money Lenders Ordinance, 1960
The Banking Companies Ordinance, 1962
The Baluhistan Money Lenders Ordinance, 1960
The Banking Companies (Recovery of Loans)
Ordinance, 1979
The Agriculture Development Bank Rules, 1961
The Banking Companies Rules, 1962
The Banks (Nationalization) Payment of
Compensation Rules, 1974
Consequence of RIBA in the Hereafter
Barzakh: drowning in a pool of blood;
being fed thrown rock until Qimiyah;

Stomaches filled with snakes;

In hell-fire forever;

The Wrath of Allah & His Prophet forever

Cannot stand, beaten by worst enemy –

Shaitan; in a state of maddness
Definition of RIBA

Is a Arabic word with means “extra”.

Any amount over and above the principle amount is

RIBA.

Late/penalty fees is also RIBA.

What is the fundamental problem with

RIBA ?
RIBA in a controlled environment
Independent in 1948

Very simple life; no complications

Following a barter system

In the case study, all other economic

variable have been removed
5 simple people – use barter system
Sajid Fish
Abid Wood
Nasir Fruits
Furqan Salt
Salman Entertainer

Not always happy, but cooperate

together in barter system.

Each feels he is cheated, would like to

change the system ?
Loaned money : solution to problem!
One blessed day, Uncle Yahoodi, arrives
with the answer to their problem.

Loaned money, as aid, minimum interest;

for the development of the society

Uncle Yahoodi ready of help out these

people;
Loan taken – is this fair (halal) ?

Name Principle Interest

Sajid 1000 + 100
Abid 1000 + 100
Nasir 1000 + 100
Furqan 1000 + 100
Salman 1000 + 100
=========================
Total amount given 5,000
Thus total money supply 5000 ONLY

Is there any problem in the above

RIBA Exposed – impossible to return – does not exist!

Loan taken = 5,000

Thus, total money supply 5,000

How will they return 5,500!

The Riba amount 500 – EXTRA does NOT
exist

RIBA impossible
to return
->ZULM=HARAM
Returning RIBA
Trying to do the impossible

Every Haram has its price !

In order to achieve the impossible,

the whole society will be affected
negatively!
Negative consequence of RIBA
 Inflation(in the long term hyper-inflation/sprilling)
 Short money supply
 Currency devalued
 Unemployment (stagflation),stressful working conditions
 Cheating and fraud
 Deteriorating quality of good & services
 Organized crime, supported by influential people
 Foreigners dictating policy
 Politically divided
 Foreigners acquiring national assets
 Foreigner instructing to disable national security
 Lawlessness, helplessness
 Rampant corruption
Interest + inflation =
 Effectively a failed state
sprilling inflation =>
 WAR!
Hyper inflation=ACHEIVED
Our progress after 60 years of Riba!
 5 simple people sit to think Extremely
Uncle Profitable
Yahoodi came to help us ?
Business
AID should be forgiven !
Transaction
To help us, Uncle Yahoodi gave us 5000.
So we should return 5000!

UncleYahoodi gave us worthless paper, in

exchange he took over our country!

Why did we accept his money on his terms?

Why didn’t we buy gold ?

Recent history of banking
Jews, were jewelers & goldsmiths

People would keep their valuable, in their

vault, in return for service charge and a
promissory note.

Itwas noticed that only 1 in 20 people

returned for their valuable. 95% did not
return!

Theirpromissory note was been circulated in

the whole town, because of the ease of use.
They began to print NOTES!
Ifthey had gold worth € 100, they could
easily print and distribute € 2000 worth!

They gave loans

They bought real assets: property,

building, farms, horses, gold mines!

They began to keep mini armies!

In the town they became Lords!

At the national level
They gave their allegiance to the king of the
area.

Promised to finance the “war”

In return only they would be allowed to

legally print money in the country.

Whenever the king needed money, they

would freely give, in return for assets of the
kingdom. New kings became slaves in their
hands!
Proof of Jewish instigated wars

Napolean Bonaparte:
The Jews provide troops for my
campaign in Poland, but they ought
to reimburse me…They are a state
within the state. The Jews are master
robbers of the modern age; they are
the carrion birds of humanity …
(Speeches before the Council of State May 7 th, 1806, Book: “Antizion” by William
Grimstard)
Proof of Jewish instigated wars
Winston Churchill, UK Prime
Minister:
This movement among the Jews in not new.
This worldwide conspiracy for the
overthrow of civilization and for the
predominance of Jews is even more
astounding. The same evil prominence was
obtained in the brief period of terror …
(Illustrated Sunday Herald, London, February 8, 1920)
Proof of Jewish instigated wars

Henry Ford, 20th Century U$

Tycoon:
Get hold of 50 of the wealthiest
Jewish financiers, the men who
are interested in making wars for
their own profit. Control them,
and you will put an end to it all.
(Cleveland News, September 20, 1923)
Proof of Jewish instigated wars
The Bank of England was established
in 1694 to help King William III out
his government’s financial crisis!
(Banking & Finance, Bcom Part 2, Prof Amin Khalid, Karach,
2002)

What crisis ?
Proof of Jewish ownership of U$

The real truth of the matter is

that a financial element in the
large centers has owned the
government since the days of
Andrew Jackson.
(Franklin D. Roosevelt, US President - 1933)

What financial element ?

Proof of Jewish instigated wars
The refusal of King George III to allow the
colonies to operate an honest money
system, which freed the ordinary man
from the clutches of the money
manipulators was probably the prime
cause of the revolution.
(Benjamin Franklin, Founding Father of USA)

What money manipulators ?

Proof of Jewish instigated wars
Proof of Jewish instigated enslavement

I believe that banking institutions are more

dangerous than standing armies…If the
American people ever allow private banks
to control the issue of currency… the
banks & corporations that will grow up
around them will deprive people of their
property until their children wake
uphomeless on the continent their
forefathers conquered.
(Thomas Jefferson, US President – 1843 – 1826)
Proof of Global Financial Web
…If you want to remain slaves of the
bankers and pay for the costs of your
own slavery, let them continue to
create money and control the
nation’s credit.
(Sir Josiah Stamp, 1880 – 1941; unofficial talk at Texas
University -1940
Director-Bank of England, industrialist, Economist, British
Civil Servant, etc)
Stock market crash & the great
depression

It was a carefully contrived

occurrence. International bankers
sought to bring about a condition of
despair, so that they might emerge
the rulers of us all.
(Louis McFadden (US Congressman), sought to impeach President Herbert
Hoover & accused the Federal Reserve of the Great Depression)
Who is authorized to print money ?
The Federal Reserve, Inc Takes
over U$ gold- Executive order of
the President
On or before May 1, 1933 all gold coins,
gold bullions, & gold certificates now
owned by them to a Federal Reserve
Bank Branch or agency, or to any
member bank of the Federal Reserve
System.
Intriguing quotes:

There is something behind the throne,

greater than the king himself.
(Sir William Pitt, House of Lords -1770)

The world is governed by very different

personages from what is imagined by
those who are not behind the scenes.
(Benjamin Disraeli, British Statesman, 1844)
Intriguing quotes:

The Morgan Interest took

advantage …
to precipitate the panic [of 1907]
guiding it shrewdly as it
progressed.
(Fredrik Allan, Life Magazine)
 The gains of Goldsmiths
Service charge for safe keeping
Gaining real asset by issuing paper money of no intrinsic
value
The sole authority to print currency money in the country
Selling the printed money to the government of the
country
Transparency & frequently changing government insure
their designed system

Materialistic point of view: Ideal to be part of the Capitalist

Goldsmith family
What is the future of RIBA ?
Should Interest based loans be used
for national development ?
Building of Dams ?

Building of bridges, roads, infrastructure ?

To acquire technology ?

For Educational programs ?

To promote Pakistan ?

To spread Islam ?

Which is a greater sin:
Pig farming or Interest based banking ?
However, there is hardly any pig farm in
Pakistan!

No export of pig or its products !

Yet,abundant branches of interest based

banks scattered throughout the country !