The Is1amic Doctrine ofRibaProhibition

A Modular Hermeneutical Examination

Azeemuddin Subhani

A thesis submitted to theFaculty of Graduate Studies and Research

in partial fulfillment of the requirements of the degree ofMaster of Arts

Institute of Islamic StudiesMcGill University, Montreal

Canada

October, 2001

© Azccmlluuin SlIbhanÎ zoo 1

1+1 National Libraryof Canada

Acquisitions andBibliographie Services

395 Wellington StreetOttawaON K1A0N4canada

Bibliothèque nationaledu Canada

Acquisitions etservices bibliographiques

395, rue WellingtonOttawa ON K1A 0N4canada

The author has granted a non­exclusive licence allowing theNational Library ofCanada toreproduce, loan, distribute or sellcopies ofthis thesis in microform,paper or electronic formats.

The author retains ownership ofthecopyright in this thesis. Neither thethesis nor substantial extracts from itmay be printed or otheMsereproduced without the author'spernnSSlOn.

L'auteur a accordé une licence nonexclusive permettant à laBibliothèque nationale du Canada dereproduire, prêter, distribuer ouvendre des copies de cette thèse sousla forme de microfiche/film, dereproduction sur papier ou sur formatélectronique.

L'auteur conserve la propriété dudroit d'auteur qui protège cette thèse.Ni la thèse ni des extraits substantielsde celle-ci ne doivent être imprimésou autrement reproduits sans sonautorisation.

0-612-79038-X

Canada

Ta my dear late son Mllnawwar

who with his Jjfe inspired this inqlliry

CONTENTS

ACKNOWLEDGEMENTS v

ABSTRACT............................................ vi

Chapter

1. INTRODUCTION

The Objective 1

The Approach .

The Scope 2

The Thesis 3

The Issue 4

The Organization 14

II. THE CONCEPT

THEMEANING

Usury/Interest -

Corresponding tenns in Various Languages...... 17

Riba - The Arabic Term

Morphological & Lexical Meaning..................... 20

Qur'anic and Sunnaic Usage............................... 23

Contextual and Historical Meaning.. 26

Juridical Meaning 28

Intrinsic Meaning 39

iii

THE REGULATORY FRAMEWORK 40

Toleration Model 40

Limitation Model 41

Prohibition Models 42

The Philosophical Model 42

The Religious Models 44

Biblical Structural Model 44

The Biblical Injunctions . 44

Qur'anic/Sunnaic Structural ModeL..... 45

The Qur'anic Injunctions........... 46

The Sunnaic Injunctions 49

III. THE ISLAMIC MODEL... 51

The Qur' anic/Sunnaic Structural Model 51

The Muslim Traditional Hermeneutical Model. 56

The Muslim Liberal Hermeneutical Model. 66

IV. CONCLUSION

Hermeneutical Examination

- Traditional and Liberal Models........ 74

BIBLIOGRAPHY 85

iv

ACKNOWLEDGEMENTS

l am grateful ta Alliih, The Almighty, for the inspiration ta

commence, the courage ta concluct and the strength ta complete this project.

My special thanks are due ta my respected professor and thesis

supervisor, Professor Wael B. Hallaq, for his inspiring academic guidance

and appreciation, and for his patience and understanding. My thanks are

also due ta Professor Uner Turgay, the Director of the Institute of Islamic

Studies, for his crucial advice, encouragement, understanding and support.

A1m Yaxley and Dawn Richards of the Institute administration deserve a

ward ofprofound thanks for their ever-available support.

The staff of the Islamic Studies Library, particularly Salwa Ferahian

and Wayne St. Thomas have earned my special thanks for their expert

guidance and help.

l must also mention and thank my old time friend and colleague

Shahid Burney for exhorting me ta return ta the academia, and later for his

assistance with obtaining research materials from the UK.

l also owe a debt of gratitude ta Carl Sharif EI-Tobgui for his

timely and invaluable help with the Arabic grammar.

Last but not the least l must single out and thank my wife, Atiya,

for her patience and understanding.

v

ABSTRACT

Author : Azeemuddin Subhani

Title : The Islamic Doctrine ofRibaProhibition

Department : Institute of Islamic Studies

Degree : Master ofArts

The Islamic prohibition of riba- is unequivocal but textually not

explicit. The traditional and liberal theological, juridical and

philosophical hermeneutical effort has addressed it comprehensively but

not conclusively. This inconclusiveness is due to the absence of the

identification of the distinctive characteristic of ribâ, resulting from the

use of limited scope pre-defined juridical and economic paradigms

employing a contextual exoteric approach, excluding the broader esoteric

content. This promotes an internaI hermeneutical imbalance between the

variables of meaning, application, rationale, underlying cause and

consequence of riba, preventing the full convergence and congruence of

these narrowly defined paradigms with the broadly implied paradigm in

the Qur'an and the Sunna, and obstructing the promulgation of the

prohibition. The resolution of this hermeneutical gridlock, predicated

upon the discovery of the distinctive rationale and the derivation of the

underlying cause of ribà prohibition, has a direct bearing on the expansion

ofscope and unreserved acceptance of the prohibition.

vi

Auteur :

Titre:

Faculté:

Grade:

RÉSUMÉ

Azeemuddin Subhani

La doctline islamique de la prohibition du no.i

L'Institut des études islamiques

Maîtrise ès Arts

L'interdiction islamique du rib.iest textuellement sans équivoque, même si la

nature de celui-ci reste à être explicitée. L'activité helTI1éneutique théologique, juridique

et philosophique - autant traditionelle que libérale - a eu soin de traiter cette question

d'une manière compréhensive, sinon, pour autant, définitive. Cet état des choses tiendrait

à un défaut de préciser les caractéristiques particulières propres au riba, résultat d'une

application de paradigmes juridiques et économiques préconçus ayant une portée limitée.

Ceux-ci s'appuient sur une approche contextuelle exotélique qui exclut la signification

ésotérique plus étendue du telTI1e « noa-», provoquant ainsi un déséquilibre

helTI1éneutique interne entre les variables portant sur le sens, l'application, la raison

d'être, la cause motlice et les conséquences du ribi. Ce déséquilibre a pour effet, d'une

part, d'empêcher la convergence et la congruence intégrales de ces paradigmes à

définition étriquée avec le paradigme de caractère plus général entendu par le Coran et la

Sunna et, d'autre part, d'entraver la mise en application de la prohibition. La résolution

de cette impasse helTI1éneutique - laquelle exige une mise en évidence du caractère

singulier du noa, en plus d'une identification de la cause motlice sous-tendant son

interdiction - pèse d'une manière directe sur un éventuel élargissement de la portée de la

prohibition ainsi que sur une acceptation générale et sans réserve de celle-ci.

VIl

CHAPTERI

INTRODUCTION

The Objective

The research project, of which the present study is the foundational

structure, is designed to examine the current scholarship on the Scriptural

doctrine of ribÏJ prohibition for hermeneutical balance and for proposaI of

any required hermeneutical realignment.

The Approach

The approach adopted for this research project is exclusively

conceptual, and not historieal or contextual. The argumentation is based

entirely on rational analysis without any reliance on historical and

contextual evidence. It is recognized, however, that contextual evidence ­

asbib nuzül, Le. the occasions or circumstances of revelation - is an

indispensable instrument of Qur'anic exegesis. But, firstly, the discovery

of Divine Law, universal truths and principles per se, although sometimes

aided by the historieal context, is not and should not be constrained by it.

Similarly, the application of the discovered Divine Law is not and should

not be constrained by the modem, more neutrally called contemporary,

context. Secondly, the mode of employment of this historical context by

the contemporary scholars is such that it leads not to clarity and

tmanimity but to ambiguity and multiplicity in interpretation. It appears

1

to be quite fashionable for the contemporary scholars to attribute - often

with self-proclaimed certitude and without historical verification - any

number of practices, even self-contradictory, to the ancient civilizations

to suite their self-serving line of argumentation. Any meaningful reliance

on historical evidence leads directly into the issue of historiography,

which would caU for an independent study in its own right.

The Scope

The main focus of this study will be a hermeneutical examination

of the current Muslim thought models on the interpretation of the Islamic

doctrine of prohibition of riba, in terms of the variables of meaning,

application, rationale (wisdom: ~llJanah), cause (ratio legis: 'ilia) and

consequence (punishment) goveming the concept of riba. This

examination of the thought models will be limited to the conceptual

conclusiveness oftheir argumentation excluding the question of the depth

and breadth of the argument and the authenticity of the supporting

historical evidenceemployed. Hermeneutical flaws will be drawn out but

the actual resolution of any indicated hermeneutical problem is not part of

this study. This study will, however, outline an independent perception of

the structural aspects of the prohibitory model based on an objective

examination of the Qur' anic injunctions and the Propheti8

pronouncements, in preparation for the later development of an

2

independent thought model. The indicated ijtihiidic task will also be

outlined and the current scholarship will be examined in this backdrop.

The supporting hermeneutical analysis of this independent thought

mode! will not be presented here, but has been developed by this writer in

outline, and presented separately as a research paper. This paper will be

fmiher researched, developed and refined, and presented later as this

writer's doctoral dissertation.

The pre-Islamic religious, philosophical and legal thought on the

subject, though a useful backdrop for a fuller understanding of the concept

and its evolution, in any meaningful detail is beyond the scope of this

study; it will only be sketched to the extent germane to the study.

The Thesis

The thesis of this study is that the CUITent hermeneutical models of

the doctrine of riba prohibition have a fundamental internaI hermeneutical

imbalance, stemming from the failure of the adopted exoteric approach,

operating within the limited-scope jmidical and economic paradigms, to

identify the distinctive and exclusive nature of riba. The identification of

this esoteric meaning, and the concomitant internaI hermeneutical

realignment, is indispensable for the full congruence of the narrowly

defined CUITent models with the broadly implied prohibitory model

discoverable from the Qur' an and the Sunna.

3

The Issue

The doctrine of prohibition of riba is one of the central tenets of

Islam. The prohibition is divinely ordained - both Qur'mlic and Sunnaic.

Punitively, its violation is regarded as a grave sin, threatened with severe

ecclesiastical consequences. For the believers, therefore, the temporal

enforcement of this prohibition should have been no different from its

acceptance as a pillaI" of faith. However, that is not the case. What sets

this terret apart from the other tenets, in the matter of enforcement, is the

fact that while its injunctions are totally strict and unequivocal on

prohibition, they are, inexplicably, not self-explanatory. It is a case of the

paucity of explicit guidance - both Divine and Prophetic - on a crucial

tenet. The quest for the discovery of the true meaning of the prohibited

riba, in order to capture the true prohibitory model, has been the focus of

Muslim scholarship since the time of the classical development ofIslamic

law. Yet, in spite of precision on the juridical level, so far this trek has

proved to be slippery and the destination a mirage. The meaning remains

as elusive and the iitihadic challenge as daunting as ever. This research

project too is a quest in this direction.

The focus of the present study, as explained above, is on the

CUITent scholarship on the subject in terms of its two hermeneutical

models - namely the Traditional Model and the Liberal Model. The

presentation of the 'Traditional' and 'Liberal' will be on conceptual and

not on chronological lines. Each Model will straddle centuries of time-

4

lines and their representative scholars. These Models will be umbrella

models, not necessarily rnirroring any particular age or individual

exclusively. Here, Traditional/Liberal will not be synonymous with

Classical/Contemporary. The Traditional Model, while predorninantly

propounded by the classical scholars, has important contemporary

followers as well. Similarly, the Liberal Model, while predominantly

propounded and developed by the contemporary scholars, neve11heless

finds support, perhaps even roots, among sorne of the classical scholars.

Being lexically very rich in meaning, the Arabic term riba, in its

contextual and legal technical application, subsumes the age-old concept

of usury/interest, which has been encountered throughout recorded history

in terms of toleration, limitation or prohibition. This historical practice,

therefore, requires and will receive examination in the development of the

conceptual analysis.

This issue of toleration, limitation or prohibition of usury/interest

has engaged human attention since time immemorial. Yet, for its own

unique reasons, it has not been satisfactorily and comprehensively

resolved so far. It has been the focus of inquiry and action by the ancient

law-code givers, rulers, philosophers, prophets, theologians, jurists and

econornists. It has been directly addressed and prohibited by the Holy

Scriptures and the Prophets of the three great monotheist religions of the

world - Judaism, Christianity, and Islam.

5

Throughout recorded economic history, this issue of toleration,

limitation or outright prohibition ofusury/interest and, later in the Islamic

context, ribihas received philosophie, religious and secular scholarship so

copious and voluminous - not as much fi:om originality and variety as

from repetition - that any further academic effort, on conventional lines,

will be an exercise in futility.

The conventional lines of argumentation on this subject have

taken the following approaches.

The ancient legal systems and the ancient philosophieal

scholarship, conventionally employing the tenn usmy as a straight­

fmward exclusive economic concept, treat its limitation or prohibition

issue from the angle ofjustice and morality (exploitation), and in the case

of the philosophieal scholarship, additionally from the angle of natural

law (infertility ofmoney). So much has been said so weIl on these lines of

. justice and morality that any meaningful addition to this conventional

chain of thought appears to be extremely difficult, if not impossible.

However, the conventional philosophieal natural law argument of

infertility (of money) requires further examination.

The conventional pristine religious thought in Judaism,

Christianity, and Islam faithfully treats the riba, or its counterpart,

prohibition as Scriptural, and hence its violation a sin. The prohibition is

strict and unequivocal. It could, therefore, be contended that the subject

should require no further human intellectuai effort. However, the

6

rationale (1;.ilanah) of the prohibition, which is sought not for faith but for

action, is Scripturally not always clearly delineated. This rationale is

regarded by the religious scholarship to be either a matter of ritual

obedience1 or contextually to be of a moral, spiritual, social and economic

character based on a literaI and contextual meaning of the concept. The

extant exegetical treatment of this identified rationale for prohibition,

along these conventionallines, is very comprehensive and convincing, but

inexplicably, not conclusive. It is this issue, not of the exhaustivenessbut,

of the conc1usiveness of the identified rationale for prohibition, which, in

the absence of any further Scriptural revelations or Prophetic guidance, is

a prime candidate for ijtihiid, and thus a point of departure from the

conventional scholarship. And this is the Hne of inquiry of this research

project.

A concurrent detailed hermeneutical examination of the Biblical

injunctions and the Judaic and Christian exegetical thought on usury,

though very crucial in the historical evolution of the issue, is beyond the

scope of this study for reasons of manageability. However, for proper

historical perspective, the structural Biblical model of usury will be

summarized, leading into the detailed examination of the Islamic

injunctions and the Muslim hermeneutical models of riba, the main

subject ofthis study.

1 I1man Ahsan Khan Nyazee, The Concept ofRibiiand Islamic Banking(Islamabad: Niazi PublishingHouse, 1995), 104..

7

The conventionai Muslim scholarship treats the Scriptural riba

prohibition as c1ear, strict and unequivocal, technically and contextually

translatable as usury/interest, other commodity excess, or benefit and

hence, stemming from economic, social, moral and spiritual rationale, and

as punishable ecc1esiastically and, according to a minority opinion2,

temporally as weIl. Yet, unlike the other two main prohibitory

foundations of Islamic financial law, gharar (speculation) and maysir

(gambling), this third prohibitory foundation, ribiï, though unequivocal in

injunction, is so enigmatic in Interpretation, that it appears to be the

supreme of aIl the Quaestiones Vexatae of Islamic law3. In spite of the

c1assical and contemporary, traditional and liberal scholarship -both

Muslim and Orientalist- devoted to it, riba has so far defied a universal

consensus on its definition, delineation of scope, identification of the

rationale and underlying cause of the prohibition, and its correlation with

the nature of the prescribed punishment in Islam. The only consensus is

that riba, whatever it means, covers or signifies, is strictly and

unequivocally prohibited and ecc1esiastically punishable in Islam, though

again its enforcement is subordinated by sorne to the doctrine of

need/necessity.

Given this CUITent fluid and inconclusive state of the exegesis and

juristic extrapolation of this crucial Islamic concept, the fundamental

2 Altaf Gauhar, Translations From The Quran. (Lahore: Sang-e-Meel Publications, 1989), 136.

3 S.E.Rayner, The TheOlY ofContracts in Isiamic Law (London: Graham & Trotman, 1991),266.

8

research (ijtihad) question of ribâ still remains what it is, why it is

prohibited, and how it is punished. The thrust of this ijtihad is not even to

attempt to question the Divine prohibition, but only to comprehend it

fully so as to facilitate its faithful enforcement in letter and spirit.

These questions, unanswered so far, point to a lack of cognizance

of the full import of the concept of ribii, which in turn has led to a pre­

occupation with an arbitral)' nalTowing of its juristic application to the

economic-financial sphere only, and, even within that nalTOW sphere, to a

diversity of interpretation leading to juristic disagreement, prompting

contemporary attempts at seeking Qur'anic and Sunnaic support for the

legitimization and legalization of certain of its forms, thus promoting

what might be labeled the scholarly Liberal Model, in juxtaposition to

the juristic Traditional Model of ribâ. This lack of agreed delineation of

the concept is compounding the confusion and hindering the juridical

transformation from interpretation to implementation, in spite of juristic

initiatives in that direction at both the national and internationallevels in

the Islamic world.

In this restricted economic-financial model, ribâ, signifying

"excess" (not in the pejorative sense of impropriety and impermissibility

but only in the neutral sense of increase or growth), is equated with excess

through nasJ'ah or nasa' (delay) or with excess through qadr (estimation).

The nasJ'ah or nasa' is the excess arising from benefits of delay and is

9

called ribi a1-nasJ'ah. The qadris the excess arising from weight, count or

measure and is called ribi al-faç/f.

The Muslim Traditional and the Liberal Models both operate

essentially within the ambit of the conceptual ribi a1-nasJ'ah and ribi a1­

faç/l, although with differing perceptions of the meaning of the two terms

which causes confusion, Further complexity is added with the

introduction of the historical concept of ribi a1-jiilliliyya (the ribi

practiced in the pre-Islamic Arabia), and of the contextual concepts of

ribiof the Qur'an (the ribicontended to be prohibited by the Qur'an) and

n'biof the Sunna (the ribi contended to be prohibited by the Sunna). The

adopted manner of association ofthese two terms with ribi a1-nasJ'all and

ribi a1-faç/1, compounds the confusion further, in the manner of the

"terminological confusion syndrome,"5.

Thus, regardless of the complexity referred above, the point of

note is that both the Models limit the application of ribË1 to the economic­

financial sphere, and thereby rely upon the identified economic, social,

moral and spiritual rationale for the prohibition. However, again both

Models make no attempt to reconcHe this identified rationale for

prohibition with the prescribed ecc1esiastical punishment for violation.

There is extant a large body of exegetical and juridical works in

support of both the Traditional and the Liberal Models. A review of this

copious literature, in translation or through contemporary commentaries,

4 Nyazee, The Concept ofRibii andls/amie Banking, 20-21.

10

reveals the following essential features of these models that are detailed

in Chapter III.

The Traditional Model, detailed and documented in Chapter III, in

its classical version only, in the development of the prohibitory model

employs u~ül al-fiqh- "a compound term [covering] the methods by

means of which law is formulated" 6 i.e. "the methodology of the jurist or

judge for deriving a legal rule from the texts"7. Accordingly, it treats the

Qur'an and the Sunna as complementary primary sources, and thus

regards both the so-called Qur'anic ribii al-nasl'ah and the so-called

Sunnaic ribii al-facjl, as a single-sourced equally clearly and unequivocally

ordained prohibition8.

The Liberal Model, also detailed and documented in Chapter III, in

a serious departure from the Traditional Model, in complete disregard for

u~ül al-fiqll, treats only the Qur'an as the primary source and the Sunna

as a secondary non-complementmy source10, with an implied lesser

binding force. Accordingly, it compartmentalizes ribii into two categories

by source. Primary, for this model, is ribii of the Qur'an Le. the ribii

deemed to be prohibited by the Qur'an, which is opined by them to refer

to ribii al-nasl'ah or ribii al-jiihjJiyya only. Secondary, for this model, is

ribii of the Sunna Le. the ribii deemed to be prohibited by the Sunna,

5 A term coined by Professor Wael Hallaq in his "Introduction", Islamic Law and Society, 2 (1996): 136.6 Wael B. Hallaq, A HistoryofIslamic Legal Theories (Cambridge: University Press, 1997),21.7 Nyazee, The Concept ofRibii and Islamic Banking, 17.8 Ibid.,17.9 Ibid., 8.10 Ibid., 11-13.

11

which is opined by them to refer to ribi a/-facjl only. The Model,

therefore, regards the so-called secondary Sunnaic ribi a/-facjl prohibition

as not strictly binding. Even within the ribi of the Qur'an which it refers

to as ribi al-nasJ'ah, the Liberal Model has an internaI difference of

opinion. One group, spearheaded by Rashid Rida, relying on the

contextuality of one of the Qur'anic injunctions (prohibition of "ribi

doubled and re-doubled") Il, limits the prohibition to compound interest

only, exempting from the prohibition simple interest as being non-

exploitative. The other group, however, treats both compound and simple

interest as prohibited under its classification of ribi of the Qur'an I2.

Another chain of thought limits the prohibition to interest on

consumption loans, exempting interest on production loans as being non-

exploitative. 13 The extreme liberal view treats the prohibition of an forms

of ribi as dispensable on the sanction ofthe doctrine ofnecessity/need. 14

The Traditional Model is distinguished by the near unanimity of

opinion on at least the major premises, of prominent c1assical and

contemporary scholars named in Chapter III. In the case of the

contemporary traditionalists supporting this Model, their method of

interpretation (use of u~iïl a/-fiqh for primary/secondary source

determination), is not in agreement with the Traditional Model. 15

1] Q. 3:13012 Nyazee, The Concept ofRibiiand Islamic Banking, 11-13.13 The view of many secular economists.14 'Abd a1-Razzaq SanhÜ11, Ma~iidir al-Ifaqq fi 'l-Fiqh al-Isliimi, 6 vols. (Beirut: a1-Majma' a1-' ArabI al­IslamI, n.d.)Vol. III, 237.15 Nyazee, The Concept ofRibii and Islamic Banking, 13.

12

The Liberal Model, on the other hand, is in fact a hybrid model

encompassing a multiplicity of many divergent individual views and

divergent methods of interpretation and extrapolation with the only

common agenda of somehow seeking exemption of modem bank interest

from the riba prohibition.

The views of these classical and contemporary scholars, in their

individual versions, are not the focus of this study. What is germane to

this study is rather the combined scholarship of these groups. The

juridical definitions and explanations of individual scholars in Chapter II

and the deposition of these models in Chapter III will therefore only

portray the representative views that bring out the fundamental points of

each group and the inter-group divergence. As will be demonstrated in

Chapter IV, the divergence between these two collective sets of

scholarship, and their internaI hermeneutical imbalance, stem from a lack

of synthesis between the variables of the perceived meaning, application,

rationale, cause and consequence of ribi.

The ultimate resolution of this divergence of opinion requires an

internaI balancing of the current hermeneutical models through a

conclusive answer to the question of the intrinsic what, why, and how

surrounding the concept of ribii, in order to align these models completely

with the prohibitory model in the Qur'an and the Sunna. This study,

however, will only extract from the extant exegetical, juridical and

Islamic economics scholarship on the subject of riba the factors that have

13

impeded the capturing of the full import of the prohibition. It will be

argued that this desideratum stems from the non-identification of the

distinctive and determining characteristic of riba and, as already pointed

out above, from the resulting internaI hermeneutical imbalance in the

Models, in terms of their perception of the meaning of the term riba, the

method and spheres of its application, the identified rationale and the

derived underlying cause for its prohibition, and the correlation between

the offense and the punishment.

The study will conclude that the hermeneutical Traditional and

Liberal Models both have internaI hermeneutical imbalance that inhibits

the full import of the Islamic prohibition of ribi. The magnet for the

Traditional Model, incorporating the wisdom and life-long endeavors of

the classical fuqahii: is the Qur'anic/Sunnaic prohibitory model, while the

magnet for the contemporary Liberal Model is the Ancient Limitation

Mode!. Therefore the full realization of the balancing prohibitory

Qur'anic/Sunnaic Model is required in order to remove the promulgatory

impediments.

The Organization

Chapter II will introduce in detail the concept of usury, interest,

and riha, covering the meaning and the regulatory framework. It will first

examine the equivalent historical terms in the ancient Sumerian,

Egyptian, Greek, Hebrew, Sanskrit/Hindi, Persian/Urdu and English

14

languages in order to glean the philosophieal and religious thought on the

issue.

It will then present the morphologieal, lexical, Qur'ànic and

Sunnaic, contextual, historical, juridical and intrinsic construction and

meaning of the Arabic tenu ribi.

This chapter will also attempt to place the concept in its

evolutionary perspective. It will present the various prohibitory models of

usury/ribi. These illclude the Toleration Model, covering the permissive

primitive practice and the Arab }ihiliyya practice, the Limitation Model,

coverillg the rate-limitillg ancient law code and later medieval practice, and

the Prohibition Model covering the Philosophieal Model and the Religious

Models covering the Biblical Model and the Qur'anic/Sunnaic Model. It

will alsovery briefly examine the hermelleutics of the pre-Islamic models.

ln support ofthese models there will be a summary presentation of

the civil legislation, the philosophical discourse and the religious

injullctions. The latter include the prohibition injunctions from the Old

Testament, the New Testament, and the Qur'an and the relevant

important Islamic Traditions (a1J.acDtl1).

Chapter III will outline an independent perception of the structural

aspects of the religious prohibitory model based on an objective

examination of the Qur'anic injunctions and the Prophetie

pronouncements, and the indicated ijtihadic task.

15

This chapt~r will then present the Muslim, Traditional Model of

ribâ as developed by the classical fuqaha and supported by the mainstream

contemporary exegetes, and the Muslim Liberal Model of ziba, as

developed mainly by the contemporary scholars, both in terms of the

meaning, application, rationale, cause and consequence of ribâ

prohibition.

Chapter IV will present and summarize the hermeneutical analysis

of the Traditional and the Liberal Models, and the conclusions of the

study.

16

CHAPTER II

THE CONCEPT

This chapter will focus on the meaning and the regulatory

:fi:amework of the concept of usury/interest/ribà. It will present the

equivalent telms in the ancient Sumerian and Egyptian, Greek, Hebrew,

Sanskrit/Hindi, Persian/Urdu and English languages. It will then examine

the morphological, the lexical, the Qur'anic and the Sunnaic, the

contextual, the historical, the juridical and the intrinsic construction of the

Arabic term ribii. It will conclude with the presentation of the regulatory

framework and the underlying injunctions.

THEMEANING

(1) Usury/Interest - Corresponding Terms in Various Languages

(a) Sumerian

The Sumerians used the same word, mas, primarily for calves and

secondarily for interest. 16

(b) Egyptian

The Egyptian linguistic usage seems to have developed its word for

interest, ms, from the verb "to give birth", ms}. 17

(c) Greek

The Greek term for usury/interest is tokosJ which means

"offspring". 1x

16 G. R. Driver and 1. C. Miles (ed.), The Babylonian Laws (Oxford: Clarendon Press, 1955), l, 174.

17

(d) Hebrew

The Hebrew language has two biblical terms for interest. The first

term is neshekh, literally meaning bite or sting, which occurs in the Exodus

(22:24) and in the Deuteronomy (23:20). The second term is tarbit or

marbit [cognate of the Arabic root r b wj, literally meaning increase, which

additionaIlY occurs in the Leviticus (25:36-37). Various contextual

meanings have been assigned to these two terms, including "advance, ,

interest verSus accrued interest" and "accumulating interest versus fixed

amount ofinterest", and "interest from the standpoint of the debtor (bite =

neshekh) versus interest from the standpoint of the creditor (increase =

tarbit or marbit). The meaning of interest is not usury in the modem sense

of the term, that is, excessive interest, but aIl, even minimal, interest. There

is no difference in law between various rates of interest as aIl interest is

prohibited. 19

The Dictionary of Islam, by Thomas Patrick Hughes, goes one step

further in defining the Hebrew term as including gain, whether from the

loan of money or goods or property of any kind. It states that, in the

Mosaic Law, conditions of gain for the loan of money or goods were

rigorously prohibited.2o

17 Fritz Heichelheim, An Ancient Economie History, trans. Joyce Stevens (Leiden: Sijthoff, 1958), J,lOS.18 Aristotle, The Politics, trans. T. A. Sinclair, revised and re-presented Trevor J. Saunders, (London:Penguin Books, 1992),87.19 Encyclopaedia Judaica- CD ROMed., s.v. "Usury" by Haim Hermanp. Cohn.20 Thomas Patrick Hughes, A Dictionary ofIslam (Lahore: Premier Book House, 1989), 544.

18

(e) Sanskrit/Hindi

The equivalent term is biyajmeaning increase.

(f) PersianlUrdu

The equivalent translated term is süd which literally means

'profit,.21

(g) English22

(i) Original Meaning

Originally, usury meant a "payment for the use of a thing". It was

thus synonymous with the currently used term of "interest " of any kind.

On the other hand, originally, "interest" meant an additional payment that

which is "between" (Interesse) the present position of the crediter and what

it would have been if the loan would have been repaid to him on the fixed

date, Le. a compensation for 'loss emerging' (damnum emergens) from

failure by debtor to repay on the stipulated date. This represented an

exception to or evasion from the prohibition of usury.

(ii) CUITent Meaning

In current usage, usury has become synonymous with excessive

interest only. Interest therefore now refers to non-excessive interest only.

The Oxford Dictionary defmes interest as" the money paid for the use of

21 Fazlur Rahman, 'Ribïi and Interest', lslamie Studies, 3 (1964),1.

19

money lent or for the forbearance of a debt according to a fixed ratio", and

usury as " the practice of charging, taking, or contracting to receive,

excessive or illegal rates of interest for money on loan".

(2) The Arabic Term Riba

(a) Morphological Construction and Lexical Meaning23

The morphological construction and lexical meaning of the Arabie

term ribii will be examined in the fullest det ail so as to comprehend the

various connotations of the term and its Qur'anic usage.

The linguistic root of this Arabie term is [ 12 ul4, which

grammatically is a defectiveroot because of the presence of the long vowel

was the third radical.

This root appears only in the first five of the total fifteen verbal

forms ofthe Arabie language.

The Form 1 verb from this root, in the thirdperson masculine

singular case, is raba in the perfect tense and yarbuwin the imperfect tense,

and the verbal noun is rabii' or also rubüw, meaning to increase, to grow, to

grow up, to exceed, to be more than25. This is an intransitive verb. The

active participle, the doer or actor, is riibin. The verb being intransitive, not

taking or requiring a direct object Le. intra-active versus inter-active, there

22Arthur Birnie, Th~Historyand Btlties ofInterest (Glasgow: William Hodge & Company, 1952),3, 7.23 The grammatical analysis has greatly benefited from the help of Carl SharifEI-Tobgui.24 Hans Weill, A Dictionary ofModem Written Arabie. ed. J.M.Cowan. (Ithaca, NY: Spoken LanguageServices Inc.1979), 374.25 Ibid.

20

26 Ibid.27 Ibid.

is no passive participle, the done ta or the acted upon. The imperfect tense

verb yarbuw, above, .appears in Q. 30:39.

The derived Form II verb from this root, which is causative, in the

third persan masculine singular case, is rabba in the perfect tense and

yurabbJ in the imperfect tense, and the verbal noun is tarbiya, meaning ta

make or let grow, ta raise, ta rear, ta bring up, ta educate, ta teach, ta

instruct, to breed, ta raise, ta grow, ta cultivate, ta develop.26 The active

participle, the doer or actor, is murabbin and the passive participle, the

done ta or the acted upon, is murabban. This form does not appear in the

Qur' anic' riba prohibitory verses.

The derived Form III verb from this root, in the third persan

masculine singular case, is riiba in the perfect tense and yuriibJ in the

imperfect tense, and the verbal noun is muriibiitun, meaning ta practice

usury27. The active participle, the doer or actor - taker of usury (usurer), is

muriibin and the passive participle, the done ta or the acted upon - giver of

usury, is muriiban. The Qur'an does not employ this derived Form, either as

verb, active/passive participle or verbal noun, in any of the prohibitory

verses dealing with ribii.

The derived Form IV verb from this root, also causative,

overlapping with Form II, in the thiid persan masculine singular case, is

a'rba in the perfect tense and yurbJ in the imperfect tense, and the verbal

21

noun is i'rbii, meaning to make grow, to augment, to increase, to exceed28.

The active participle, the doer or actor, is murbin and the passive participle,

the done to or the acted upon, is murban. The imperfect tense verb, yurbJ,

above, appears in Q. 2:276.

The last derived Form V verb from this root, in the third person

masculine singular case, is tarabbâ in the perfect tense and yatarabbâ in the

imperfect tense, and the verbal noun is tarabbin, meaning to be brought up,

to be educated, to be bred, to be raised29. The active participle, the doer or

actor, is mutarabbin and the passive participle, the done to or the acted

upon, is not applicable. There is no Qur'anic usage of this form in the riba

prohibitory verses.

The derived noun, from this root ribilo (indefmite) and al-riba

(definite) has been, assigned the lexical meaning. of interest, usurious

interest, USury.31 The Qur'an employs the indefinite noun, ribi, only once

in 30:39. According to conventional Muslim scholarship, though not

unanimous and less weighty, the term ribi here refers to gift and not to

usury. The Qur'an employs the definite noun, al-riba , in aIl the other

prohibitory verses on ribi, Le. 2:275, 276, 278, 279, 3:130, and 4:161,

always written as al-ribawi, but pronounced as al-ribi as above. This is

because the waw in al-ribawa serves only as a seat for the subsequent alif

maqsura and has no morphological value. A parallel written construction is

28 Ibid.29 Ibid.30 Ibid., 375.31 Ibid.

22

to be found in the case oftwo important Qur'anic terms, $aliit, written as

$aliit or as $alawiit but both pronounced as $aliit ,and zakiit, written as

zakiit or as zakawiit but both pronounced as zakiit.

The adjective of this noun is ribawl, meaning usuriouS32. This

adjective, ribawl, has not been used in any of the above quoted prohibitory

verses, and to the best of lœowledge, elsewhere in the Qur' an. This

adjective is associated with the six commodities 1}.adith of the Holy Prophet

presented below.

Lexically, ribii has also been translated as 'Danism,33. The term

Danism means lending money on usury, and is derived from the Greek

word Daneisma meaning a loan.34 Danism has been translated into Arabie

to mean "loans with fil;.ish [excessive] riba."35

Cb) Qur'anic and Sunnaic Usage

The term riba in its various derived forms oecurs both in the

QUI'in, as indicated above, and in the a1}.adith. However, in the form of a

definition, a specifie meaning of this term and its derivatives is not readily

and directly discernable either from the Qur'an or from the a1}.adith. The

Qur' anic and the Sunnaic usage of the term, including and beyond the

prohibitory context, conveys various shades of meaning, as detailed below-,-

32 Ibid.

33 Rarith Sulayman Faruqui, Faruqi's LawDietionary - Arabie English, (Tripoli: Libyan Publishing Rouse,1962).34 E. Cobhan Brewer, Dictionary ofPhrase &- Fable. (1898),329-330.

23

The Qur'anic usage of the term, as partly touched upon above,

conveys at least six different shades of meaning as fol1owS36:

(i) to grow:

'~.. wa tara al-arcja hiïmidatan fà-idha anzalna 'alayha I-ma'a

ihtazzat wa rabat... " (al-Hajj: 5)

"And thou beholdeth the earth barren, then when We send

down water upon it, it quickens and grows..." (Q. 22: 5)

(ii) to prosper; to increase;

"Yam1J.aqu 'alliihu alriba wa vurbJ al-~adaqat... " (al-Baqarah: 276)

" God destroys ribâ, but makes alms prosper" (Q. 2: 276)

"Wa ma ataytum min riban liyarbuwa 5 amwalin nas fala yarbu

'inda Alliihi... " (al-Rüm: 39) .

"And what you invest in ribâ so that it may increase upon

the people's wealth, it increases not with God"(Q. 30: 39)

(iii) to Tise ( e.g. of a hill):

"... Wa awaynahumailarabwatin... " (al-MüminÜD: 50)

IIAnd W'e gave them refuge upon a height" (Q. 23: 50)

35 Faruqui, Faruqi's Law Dietionary - Arabie English. .

36As summarized by Fazlur Rahman in his, 'Ribâ and Interest.' Islamic Studies3 (March 1964): 1-43.

24

"... Ka-mathalijannatin bi-rabwatin ... " (al-Baqarah: 265)

"As the likeness of a garden upon a hill" (Q. 2: 265)

(iv) to swell (e.g. foam):

"... Iii1Jtamala saylu zabadan arribivan... " (al-Ra 'd: 17)

"Then the torrent carried a swelling scum" (Q. 13: 17)

(v) ta nurturè; to raise Ca child):

''Rab birhamhumikamirabbavinJ$aghiran" (Bani Isra 'Ji: 24)

"Have mercy upon them as they raised me up when 1was a child" (17: 24)

" Qila ilam n urabbika fini waHdan... " (al-Shp 'ra': 18)

"He said, did we not raise thee amongst us as a child?" (Q. 26: 18)

(vi) to augment; increase in power:

"... Fi ikhadhahum ikhdhatan ribiyatan" (al-lfiqqah: 10)

"He seized them with a surpassing grip" (Q. 69: 10)

'~ .. An takuna ummatuhu hJya arhimin ummatin ... " (al-Na1J1: 92)

"That one nation be more powerful than another nation..." (Q. 16: 92)

25

The Sunnaic usage of the term riba conveys an economic

connotation of increase, excess, growth in the context of 'exchange of

similarity and dissimilarity', as illustrated by the famous ribiiwi

commodities (gold for gold, ...) iJadith quoted below. However, the

meaning of the riba /incest equivalence iJadith, also quoted below, requires

further elaboration.

(c) Contextual and Historical Meaning

The contextual and historical setting of the Revelation is relied

upon heavily by the exegetes in support of their perception of the meaning

and definition of the, ter;m ribii.

The Qur'mic usage of 'al-riba doubled and re-doubled' (3:130) is

believed by some of the exegetes to refer to, and to restrict, the meaning of

the term riba to the Arab jiihiliyya period financial practice of doubling,

and later re-doubling, of the principal amount for extensions of the credit

term beyond the original. This implies either the absence or the exclusion

of a charge for the original term of the loan or credit from the coverage of

riba. Regardless ofthis ambiguity, what is not clear from this association is

whether ihis was the only form of riba being practiced then.

While the authenticity even of many transmitted PropheticaiJadIth

is difficult to verify, the verification of the many historical daims about

the Arab financial practices of the time is even more difficult. As pointed

out in Chapter 1 (Approach), the contemporary exegetes tend to attribute

26

any number of financiai practices, even self-contradictory, to the ancient

Arabs to suite their line of argumentation. The documentation of the

ancient Arab financiai practices is virtually non-existent. The Qur' an and

l;.adith literature is the only extant reliabIe, though by design not

exhaustive, guide on this empiricai question.

Similarly, on the strength ofQ. 4:161, which, it is c1aimed by sorne

exegetes, links the Jewish practice of exacting the prohibited ribiï with

their devouring of others' property wrongfully, riba is given an economic

meaning and a usurpation rationaie. However, this c1aimed link between

these two parts of the verse needs to be proved.

Furthermore, the famous sermon of the Holy Prophet at the time of

his Farewell Pilgrimage to Mecca is cited as evidence of the existence and

abolition of the riba of his unc1e, 'Abbas ibn 'Abd ai-MuHalib. This

authentic l;.adith does refer to the practice but not to its form. The

mechanics of this financiai practice attributed to him arenot ascertainable

from the l;.adith itselfto derive a precise meaning of the term ribii.

The historicai context provides a usefui point of reference. But the

employment of contextuai references for the derivation of principles

requires additional historicai evidence to fully understand the modus

operandi of the practices being referred to.

27

(d) Juridical Meaning

A review of the literature reveals that the juridical meaning

assigned to riba, though diverse in presentation and detail, essentially refers

to any increase in a transaction of exchange without a counter value.

The Dictionary of Islam, by Thomas Patrick Hughes, gives a

juridical definition as follows:

"A term in Muslim law defined as an excess according to a legalstandard of measurement or weight, in one or two homogenousarticles opposed to each other in a contract of exchange, and inwhich such excess is stipulated as an obligatory condition on one ofthe parties without any retum"

It further explains: "The word ribi appears to have the samemeaning as the Hebrew neshec, which included gain, whether fromthe loan ofmoney, or goods, or property of any kind. In the Mosaiclaw, conditions of gain for the loan of money or goods wererigorously prohibited." 37

The various juridical definitions and expositions, underlying the

above, as given by the fuqahi and commentators, are given below38.

The traditional position is summed up by the definitions of al-

Sarakhsl, al-Kasanl ~d I1?n Rushd:

al-Sarakhsl, a f;Ianafi authority, in his book al-Mabsii,t defines ribi

both in its literaI and technical meaning as:

37 Hughes, A Dictionary ofIslam, 544.38 The presentation here is based mainly on the presentation by Nyazee in his, The Concept ofRibii andIslamic Banidng, 19-27.

28

Ribiï in its literaI meaning is excess ... and in the technicai sense (inthe sharI'ah), ribiïis the stipulated excess without a counter value inbay' .39

and further goes on to explain the two types of riba -- ribiï al-nasJ'ah and

ribiï al-facfl-- as fo11ows:

[The words]· facfl is ribiï imply facfl througIl qadr and they implyfacfl through a period of deIay, and both are intended. This waselaborated in the tradition of 'Ub'iidah ibn al-~amit ...40

Another I:Ianafi authority, Abü Bakr al-Kiisiini defmes ribiï only in

its technicai (legal) sense in the context of its two types - ribiï al-facfl and

ribiï al-nasiï' (nasJ'ah ). Even in this technicai sense, he does not give an a11-

encompassing Iegai definition. Moreover, he does not give the literaI

meaning. He defines riba as:

Riba in the j argon of the Iaw is of two types: ribiï al-facfl and ribiï al­nasiï'. As for ribiï al-facjl, it is the excess over the substance of thewealth that has been stipulated in the contract of bay' according toa Iegai criterion, which is [realized through]measure and weight inthe genus, while according to al-Shiifi '1, it is the absolute excessspecifica11y in food with uniformity of genus. As for ribiï al-nasiï', itis the difference (excess) between the termination of delay and theperiod of delay and the difference (excess) between the possession('ayn) and its non-possession (dayn) in things measured andweighed with different genera as well as in things measured andweighed with the uniformity of genera. This is according to us, andaccording to al-Shiifi '1, it is the difference between the terminationof the period and the delay in foodstuff and precious metais (withcurrency-vaIue) specifica11y.41

39Abü Bakr MlÙ}.ammad ibn Ab1 Sahl al-SarakhsI, al-Mabsü{30 vols. (Cairo: Matba'at al-Sa'adah,1324­

31/ 1906-13. Reprint Karachi, 1987). vol. 12,109.40 Ibid., 111.41 Abü Bakr al-KasanI, Badi'j' al-$ani'j'(Beirut: Dar al-Kitab a1-'ArabI, 1982). vol. 5, 183.

29

Ibn Rushd defines ribiiin the context of the ribiiofjiihiliyya only:

The jurists agreed that usury is found in two things: sales and thatwhich is established as a liability through sale, credit, or othertransactions. Ribii which is incurred as a liability is of two kinds.First is that about which there is an agreement, and this is the ribiiof the period ofjiihiliyya (the pre-Islamic age) which is prohibited,as they used to stipulate excess in loans and then delay the period(ofrepayment). They used to say, "Grant me further delay and l willincrease it (the amount)." This is what the Prophet (God's peaceand blessing be upon him) meant when he said at the farewellpilgrimage, "Take heed, verily the ribii of jiihiliyya is annulled andthe first (daim) of ribiiI cancel is that of 'Abbas ibn al-MuHalib."The second kind is "loss for hastening the period." This iscontroversial and we will describe it in what follows. 42

The later compàrtmentalization of ribii into' ribii of the Qur'an (to

mean ribii aJ-nasJ'ah) and ribii of the Sunna (to mean ribii al-faeJl), which

provided the foundation for the liberal thought on ribii, finds its basis in al-

Ja~~a~ who states:

The ribii that was known to the Arabs and was practiced by themwas the lending (qarcf.) of dirhams and diniirs for a period with anexcess in proportion to what was lent and on which they had agreed.They were not acquainted with the spot sale when it contained anexcess of the same genus.43

Based on this practice, al-Ja~~a~ further defines ribi as:

The ribii of the jiihiliyya is a loan given for stipulated period with astipulated increase on the principal payable by the 10anee.44

The above referred basis for the compartmentalization of riba is

reinforced by al-Raz! in his al-TafSIr al-KabIr:

42Abü al-Walid Mul;1ammad ibn Alpnad ibn Mul;1ammad Ibn Rushd, Bidiyat al-Mujtahid wa­Nihiiyat al-Muqta~id 2 vols. (Cairo: Dar al-Salam, 1995). vol. 2, 96.43Abü Bakr Alp:nad ibn'Ali al-Ja~~as al- Raz!. AfJ.kiim al-Qur'iin. (Beirut: Dar al-KiŒb al-'ArabI, n.d.).vol. 1,465.44 Ibid., vol. l, 469.

30

Know that ribi is of two kinds: ribi al-nasl'ah and ribi al-façflRibi a1-nasl'ah was weIl known and familiar during the jiïhiliyya.This was so because they used to give wealth on the condition thatthey would take a fixed amount each month, while the principalamount still remained. Thereafter, when it was time for therepayment of the debt, they demanded the principal from thedebtor. If he was unable to pay, they increased the daim and theperiod. This is the ribi that they used to practice... As for the ribithrough spot transaction (ribi al-naqd), it is the sale of wheat forflour made from it, or what is similar.45

In rebutting the views of Ibn 'Abbas that the prohibited ribi is ribi a1-

nasl'ah alone, al-Razl further elaborates as follows:

The evidence for Ibn 'Abbas is that the words of the Exalted, "Allah haspermitted sale," include the spot sale of one dirham for two dirhams andHis words, "prohibited ribi," do not include it, because ribi is anexpression of excess and each excess is not prohibited. On the other hand,His words, "prohibited ribi," include a specific type of contract that theyused to conclude as ribi .This was ribi al-nasl'ah. Thus, His words,"prohibited ribi," apply exclusively to nasl'ah and it is, thereforeestablished that His words, "Allah has pernfltted sale," include the spotsale and His words, "prohibited ribi," do not include it, which necessarilyimplies that it is permitted. Further, it is not possible to say that it isprohibited by the iJadith as it implies the restriction of the apparentmeaning of the Qur'an with an individual narration (khabar wii1Jid), whichis not permitted. This is what Ibn 'Abbas (appears to have) conveyed andits essence lies in whether the restriction of (the text of) the QUI'an ispermitted or not? As for the majority of the mujtahids, they agreed aboutthe prohibition ofribi in both kinds: the first kind by the QUI'an, and thesecond by the Sunna. 46

Shah Wall Allah, a traditionalist scholar, seems to provide support to the

liberals by further stressing the distinction when he explains:

Know that ribihas two aspects: actual and figurative. The actual form isin debts, and we have mentioned that it has a central place within the

45Fakhr al-DIn al-Razi, al-Tafsir al-KabIr. 32 vols. (Beirut: Dar I1).ya' al-Turath al-'ArabI, 1980, vol. 7. 91.46 Ibid., 92.

31

topic of mu'imaliit. The people in jiihiliyya were intensely occupied withit, and it was the cause of continuous wars, and a little of it used to leadto more. It became necessary to seal its door as a whole, therefore, what isrevealed in the Qur'an about it was revealed. The second type is ribii al·fàcjl, the source of it being iJadith ... and this was called ribii by extensionand as a metaphor for the true form of ribii ... It was then that ribii in thismeaning was practiced widely till the true legal form came to be realizedin this toO.47

Abü Zahrah, seems to echo Shah warr Allah, when he spells out the

distinction between ribiiof the Qur'an and ribiiof the Sunna:

Before we put down the pen, we will discuss the legal issue related to ribii, which is that the excess in lieu ofthe period [of repayment] is the ribâ ofthe jiihiliyya . It is also called ribii al-nasl'ah, because the excess in it is inlieu of the period, that is, the duration of delay. The scholars are all inagreement about its prohibition, and it is the ribii of the Qur'an ... Thereis a technical form of ribii or that of the Islamic usage. This is the ribii ofsales (ribii al_buyü,).48

Finally, Abü1 A'la Mawdüdi, though a traditionalist, clearly spells out the

foundation of the liberal position by pointing out the distinction between ribii al-

nasl'ah as the ribi of (prohibited by) the Qur'an, and ribi al-fàcjl as the ribâ of

(prohibited by) the Sunna:

We have stated earlier that ribi, in fact, is that excess or fi'idah which acreditor receives from the debtor as a stipulated excess over and abovethe principal amount. In the terminology of the law, this is called ribii al­nasl'ah. Thus it is ribi that is paid and received in a loan transaction. It isthis ribi that has been prohibited by the Qur'an. The whole Ummahagrees about its prohibition.49

47 Shah WaIl Allah, Ifujjat Allah al-Bilighah, 2 vols. (Cairo: Dar al-Turath, 198?).vol. 2, 106-107.48Abu Zahrah, Foreword to Zakl al-DIn Badawl, Nll?arlyat al-Riba a1-MlÙ}.arrarn Fï al-Sharl' a al-Isliirniyya.(Cairo: Dar wa -Ma!abi' al-Sha'b, 1940). Trans. Imran Ahsan Khan Nyazee, quoted in his The Concept ofRiba and Is1arnic Banking, 13.49 Abu1 A'la Mawdudi, Boo[Interest], (Lahore: Islarnic Publications (private) Ltd.,1989), 163.

32

... Ribi aJ-facjlis the excess that is found in the spot exchange oftwo things of the same genus. The Messenger of Allah (p.b.u.h.) hasprohibited this form.5ü

The juridicaI définitions and explanations by the Liberal" scholars are

quite varied. The following summations of the position of Ibn 'Abbas, Ibn

Qayyim, Mul1ammad 'AbduhIRashld Riçlii and Sanhür1 are based on the work of

Nabil Saleh 51:

'Abdullah Ibn 'Abbas, habitually called Ibn 'Abbas (b. 622C.E.), a cousin

of the Roly Prophet, along with some of the other Companions (Usman Ibn Zayd,

'Abdullah ibn Mas'üd, 'Urwa ibn Zubayr and Zayd ibn Arqan) regarded ribi al

jihiliyya as the only unlawful ribi which involved increase in the debt for

increase in the period ofrepayment. They regarded ribi aJ-nas]'ah and ribi al-facjl

as being provided for in the famous six commodities iJadith and as being lawful.

They based their liberal interpretation on an authentic but controversial l;.adith,

reported by Ibn 'Abbas himself and regarded by them as superseding the six

commodities iJadith, which substantially states: "No ribi except in the nasl'ah"

(meaning pre-Islamic ribi). Ibn 'Abbas is reported to have later retracted on his

earlier in~erpretation.

Ibn Qayyim al-Jawziyya, a I:Ianbali theologian, differentiates between

"hidden ribi" (ribi khali) - a ribiby way of increase (ribi aJ-facjl), and "manifest

50 Ibid., 165.

33

ribi" (ribijaH)- a riba by way of deferment (ribi a1-nasl'ah). For him, "hidden

ribi" is not forbidden in itselfbut only when it is a way to gain "manifest ribi ':

which is forbidden for itself. For him, the degree of prohibition was not the same

in both the categories - much stronger in "manifest ribi" or ribi al-nasJ'ah than

in "hidden ribi" or ribi al-fàq1. Consequently, "manifest ribi " or ribi a1-nasl'ah

cannot become lawful except in the case of pressing necessity (darura muJji'a),

like that 'which allo~s the eating of carrion. But, "hidden ribi" or ribi af-fàiflcan

become lawful in case of need (llija) only. "Hidden ribi" or ribi al-fàq1 is

prohibited when there is fear that may lead to ribi a1-nasJ'ah and it is allowed in

case ofneed.

Multammad 'Abduh and Rashld Riga are the first contemporary scholars

of the 201h century who came o~t cleady in defense of the modem bank interest

as exempt from the ribiprohibition. They considered modem bank interest as not

covered under the historical practice ofribi al-jahiliyya which they treated as the

only prohibition, and even that excusable by the doctrine of dire necessity. They

treated ribi al-faq1 and ribi al-nasl'ah both as Sunna-based and therefore not

even prohibited - only makrüh. Their views on ribi have been summarized by

Nabil Saleh as follows:

" (a) The only disallowed ribiis ribi aljahiliyya (pre-Islamic riba), whichis the manifest (jaR) ribi and consequently is prohibited not as a way ofperforming an usurious transaction but as an usurious transaction in itself.As for the two other sorts of ribi, namely ribi a1-faq1 and ribi al-nasl'ah(both provided for in :E:Iadith and not in the Qur'an), their prohibitiontends to close the loopholes which otherwise might permit manifest ribi(FibijiIi). Thus ribi a1-fàifl and ribi al-nasl'a)J are under a presumption of

51 Nabil A. Saleh, Unlawful Gain andLegitimate Profit in Islamic Law, .second ed. (London: Graham &Trotman, 1992),34-37.

34

prohibition and this presumption is not conclusive but rebuttable. Thusagain the sale of any of the six articles mentioned in the hadith, with anincrease and whether in a hand-to-hand transaction or in a deferred one, isdisallowed only if it is intended to lead to manifest ribiï (ribiïjiïlJ), whichtakes place when interest accrues on interest aIready accounted by thetime the transaction was concluded.52

(b) As a result, the first increase on the termed loan is lawful, even thoughagreed in consideration of the delayed term of payment. But if, onmaturity date, it is decided to postpone that maturity date against afurther increase, that is the unlawful ribiï al-nasl'ah.53

(c) The consequence which comes to mind is that whereas ribiï jiiH, themanifest ribiï, can be deemed lawful only in case of pressing necessity,such as the one which allows the eating of carrion, the two other sorts ofribiï, namely ribiï al-faql and ribiï al-nasl'ah (both provided for in ijamthand not in the Qur'an) are regarded with aversion (kariïhiyya) but not asunder a rule ofprohibition.54

(d) Fïnally, it is attributed to Shaikh MlÙ}.ammad 'Abduh that he foundways to show that under Islamic law both interest generated by savingsbank accounts and that generated by insurance policies were admissible."

For 'Abd al-Razzaq Sanhurl, "the prohibition of ribiï is the ruleand has nothing to do with aversion (karahiyya),55nevertheless thedistinction between ribiï al jiïhiIiyya, ribiï al-facfl and ribiï al-nasl'ahshould be maintained according to the following analysis: ribiï al-faql is away to achieve ribiï al-nasl'ah which is a way to achieve ribiï aljiïhiliyya;for it is sufficient , as far as ribiï al-nasl'ah is concemed to allow paymentto be postponed once the debt has matured, charging further interest, soas to attain ribi al Jiïhiliyya . Consequently, ribi al-faql and ribi al­nasl'ah are not under a direct prohibition (contrary to pre-Islarnic ribii,-which is), but und~r a prohibition ofillicit m~ans - a prohibition designedto close the loopholes which might lead to pre-Islamic ribi.. 56 The resultof such degrees of prohibition is that ribi al jiïhiliyya is allowed only incase of pressing necessity (darüra mulihha), while ribiï al-faql and ribiï al­nasl'ah are deemed lawful in case ofneed {JJ.ii}a).57"

52 Fatiiwii a1- Imiim MuiJammad RashldRicfi, eds. S. Munajjid and Y. Khürl. 5 vols. (Beirut: Dar al-Kitabal-Jadid, 1970). vol. 11. 606.53 Ibid., 608-609.54 Sanhürl, M~iidiral-IJaqq, vol. III, 220. Karahiyya is a religious censure with no practical effect on thetransaction itself.55 Ibid., 222-234.56 Ibid., 222-237.57 Ibid., 237.

35

A review of the definitions and explanations given above indicates a

process of graduaI watering down of the perception of the ribiprohibition as one

moves from the traditional to the liberal thought model. On one end of the

prohibitory spectrum is the complete and absolute prohibition, as evidenced in

the definitions by al-Sarakhsl, al-Kasanl and Ibn Rushd, cited above. On the

other end of the spectrum is a steadily widening scenario of partial and

contingent prohibition as evidenced in the definitions of the liberal scholars, Ibn

'Abbas, Ibn Qayyim and Mullammad 'Abduh /Rashld Riq.a cited above. It

culminates in the formulation of Sanhurl, above, where aIl forms of ribi are not

prohibited, and even when prohibited, become permissible on the sanction of the

doctrine ofnecessity and even need.

It will be noticed that in aIl the juridical definitions and explanations

cited above, the focus of attention is the form ofthe financialleconomic excess,

how it arises, how its prohibition is sourced and, in case of the Liberal scholars,

how it can be restricted or even exempted. The definitions do not go beyond the

technical usage of the term ribi to connotations other than the

financialleconomic which are expressed in the Qur'an itself as detailed above.

Moreover, these legal depositions and explanations do not touch upon the

question ofrationale of the prohibition.

Within this technical paradigm of ribi, based on the juridical definition

by al-Sarakhsl, given above, in which al,·Sarakhsl gives the literaI meaning of

riba as 'excess' and the technical meaning as 'the stipulated excess without a

counter value in bay', Nyazee has developed a very concise and lucid juridical

36

definitio:p.al model which is outlined below58. As will be shown below, this

definitional framework is very useful in clarifying the 'terrninological confusion

syndrome' referred to above.

Nyazee identifies the main elements of the above al-Sarakhsl definition as:

1. Ribiiis "excess".

2. It is an excess that is stipulated in a bay'(exchange).

3. It is an excess that is without a cOlmter value. 59

Derived. from the ahove, his definitional model is:

Ribiiis excess revealed in two ways through:

1. Qadr (estimation) arising from weight, measure, or count of the two

quantities being exchanged in a baye. If the exchange is ribawl, this

excess is called ribii al-facjl whose beneficiary is the seller, or in case of a

loan, the creditor.

2. NasJ'ah or Nasa' (delay) arising from benefits of delay of payment or

delay of delivery, measured by the period of delay. If the transaction is

ribawl, this excess (benefit) is called ribii al-nasJ'ah, whose beneficiary is

the party effecting the delay.60

Based on the above distinction of the beneficiary of the excess, contrary

to popular understanding, in any loan transaction the creditor is the recipient

58 Nyazee, The Concept ofllibi and Islamic Banking, 19-39.59 Ibid., 20.60 Ibid., 20-21.

37

of ribi_al-fagl and the debtor is the recipient of (the benefit of) ribi al-

nasl'ah.:. Interest payment received by the creditor is ribi al-fagl and not ribi

al-nasl'ah6J• It will be noted that the ribi al-nasl'ah is not objectively

quantifiable as it is the unspecifiable benefit attributed to the debtor through

the use of the loaned amount during the period ofrepayment. T~e recognition

ofthis distinction is very crucial for a correct understanding ofthe concept of

ribii. 62 The lack of clarity and precision on this point among many

contemporary scholars and even judges63 is the source of much confusion. In

complete disregard for this inter-Iocking relationship between these two

aspects of ribii, the contemporary scholars maintain, apparently without

sufficient justification, that "ribi al-nasl'ah is the ribiof the Qur'an and ribi

al-fagl is the ribi of the Sunna,,64. It can be seen that this Liberal assertion,

read together with the above conceptual distinction between ribi al-faç/J

accruing to the creditor and ribi al-nasl'ah accruing to the debtor, implies

unintentionally and inadvertently of course, that neither the Qur'an nor the

Sunna ofitselfhas a complete prescription for a loan transaction. The Qur'an

is being seen as catering to the borrower alone and the Sunna to the lender

alone. This is cleady an untenable implication. This compartmentalization of

riba- by the contemporary scholars into ribi of the Qur'an and ribi of the

Sunna is therefore conceptually not supportable. Nyazee maintains that this

61 Ibid., 23.62 Ibid.63 Noticeable in the different opinions expressed in the judgement of the Shari' ah Appellate Bench ofPakistan Supreme Court of December 23, 1999. See Web site of Advanced Legal Studies Institute,Islamabad (www.nyazee.com).64 Nyazee, The Concept ofRibiiand Islamic Banking, 23.

38

compartmentalization is rooted in the explanations of ribii provided by Ibn

Rushd, al-Ja~~a~ and particularly al-Raz!, all quoted above.65

Nyazee conc1udes that both facjl and nasJ'ah are to be found in the type of

ribi mentioned in the Qur'an, and both are inc1uded in the types [of ribi]

mentioned in the Sunna. Ribiaf-facj1 and ribi af-nasJ'ah are prohibited by the

Qur'an just as they are prohibited by the Sunna. In fact, ribi of the Qur'an

and ribi of the Sunna are exactly the same. The Sunna is merely acting as a

connitentary.66

(e) Intrinsic Meaning

While the term riba has been examined from the exoteric

morphological, lexical, and particularly contextual, historical, and juridical

angles, no attention appears to have been focused by the exegetes on its

esoteric intrinsic meaning. The search for the intrinsic meaning of the term

riba is at the heart of the whole iitihidic question. A very crucial question

remains unanswered, even unraised. What is the distinguishing

characteristic of the term that makes its lexical meaning of growth so

crucial for the doctrine of its prohibition? The successful quest for this

intrinsic meaning and distinguishing characteristic will constitute a

scholarly landmark.

65 Ibid., 23-24.

39

THEREGULATORYFRAMEWORK

The evolutionary pattern of the regulation of this concept will be

examined, not chronologically but in terms of regulatory paradigms. These

will be in the form of what might be labeled, conveniently, as the

Toleration Model, the Limitation Model and the Prohibition Model, the

latter incorporating the Philosophical Model and the Religious Model,

deriving their implementing force from custom, civil legislation,

philosophical discourse and Scriptural injunctions respectively.

Conceptually, the regulation of the concept of usury/interest/n'bi

has had a checkered history. It has alternated between total toleration and

partial limitation, as sanctioned by the community or the State in various

periods of history and in the contemporary world, and outright prohibition,

as expressed in ancient philosophical thought, and as divinely ordained in

the three great monotheist religious traditions.

The examination of these regulatory frameworks will coyer only

those aspects that are germane to the nature of this inquiry i.e.

hermeneutical analysis.

THE TOLERATION MODEL

In the Toleration Model, which historically extends from the

primitive period to the Jahiliyya period to even the contemporary period,

the regulatory framework is the simplest - there is no regulation. The

66 Ibid., 27.

40

practice of usury, in aIl its forms, persists even when it is exploitative.

There is neither condemnation, nor limitation, nor prohibition of the

concept. There is no hermeneutical issue.

THE LIMITATION MüDEL

In the Limitation Model, evidenced in the ancient developed secular

juristic cultures, and also later, the practic.e of usury is permitted, but

varying limits are placed on the maximum legally chargeable rate. The

prohibition is limiting in nature; it applies only after a certain point. The

meaning of the term is charge for the use of money, and hence the

application of the concept is accordingly only financiaVeconomic. The

rationale of the limitation of the practice is concem of the ruler/State for

the welfare of the poor. The consequence of any violation is therefore civil

law penalties. Thus within its defined parameters, the model demonstrates

perfect hermeneutical balance.

The ancient so-called Law Codes incorporating this model of

limiting the maximum chargeable rate of usury, in varying forms and

measures, are too numerous and copious to reproduce here. Similarly, the

later period State/Church edicts on the issue incorporating the limitation

model deserve a separate treatment.

For historical perspective, these ancient Law Codes, limiting the

usury rate, are the Ur-Nammu Code (c. 2050 RC.), the Code of Eshnunna

(c. 1925 B.C.), the Code of Lipit-Ishtar (c. 1860 RC.), the Code of

41

Hammurabi (c. 1700 B.C.), the Hittite Code (c. 1450 RC.), the Assyrian

Code (c. 1350 B.C.), and the Covenant Code (c. 1000 B.C.). 67

THE PROHIBITION MODEL

ln the Prohibition Model, characteristic of the philosophieal and the

monotheist religious traditions, there is an outright prohibition on the

practice of the concept. Hence, in this model, particularly in the religious

versions, it is very crucial to define the precise meaning of the concept, to

delincate the scope of its application, to identify the rationale and to derive

the underlying cause of the prohibition, and to justify the punishment for

the violation.

(1) THE PHILOSOPHICAL MODEL

The most influential ancient philosophieal model comprises the

Greek philosophical condemnation of usury/interest. Plato (c. 429-347

B.C.) and Aristotle (384-322 B.C.) both condemned and outlawed the

practice of usury/interest on loans. Their rationale for the condemnation

was the barrenness ofmoney. Aristotle condemned usury/interest in a c1ear

and reasoned manner in his philosophical discourse:

Of the two sorts ofmoney-making, one, as 1 have just said, is a partof household management, the other is retail trade: the formernecessary and honorable, the latter a kind of exchange which isjustly censored; for it is unnatural and a mode by which men gainfrom one another. The most hated sort, and with the greatest

67 George Mendenhall, Law and Covenant in Israel and the Ancient Near East (pittsburgh: BiblicalColloquium, 1955),9.

42

reason, is usury, which makes gain out ofmoney itself, and not fromthe natural use of it. For money was intended to be used inexchange, but not to increase at interest. And this term usury(tokos) [offspring], which means the birth ofmoney from money, isapplied to the breeding of money because the offspring resemblesthe parent. Wherefore of aU modes of making money this is themost unnatura1. 68

In this model, the contextual meaning of the term usury is a gain

from money, and in line with this meaning, the application is

financial/economic, although the literaI meaning of the term usury as

offspring (tokos) is suggestive of a possible broader application of the term.

The rationale for the condemnation is the naturallaw argument of fert ility.

Being only a philosophic edict without Divine Ordinance or State

legislation, it is only a moral exhortation without any ecclesiastical

punishments or civil penalties.

The seeds of a henneneutical imbalance are however clearly evident

in this mode1. The model starts with a meaning of usury as a broad concept

of offspring (tokos), but narrows it down to the practice of making money

from money, a financial application only, and again uses the broadly

applicable argument of fertility, to label the process as unnatural. The only

henneneutical balance ,in this model is between the rationale and the

consequence Le. observance ofnaturallaw.

68 Aristotle, Politica, 1,10,1258 a- b (Jowett trans1.).

43

(2) THE RELIGIOUS MODELS

These comprise· the Biblical and the Qul,"'anic/SunnaicModels

which represent the culmination of the evolutionary process of the concept

of ribi.

THE BIBLICAL STRUCTURAL MODEL

The Biblical Structural Model is the first divinely ordained

prohibitory mode!. A review of the injunctions shows that the Old

Testament is prohibitory about usury, while the New Testament is

recommèndatory about its converse i.e. charity. The Qur'an puts the

Biblical prohibition in perspective when, in 4:161, it refers to the

prohibition of riba for the Jews and to their violation of it at the pain of

grievous punishment. These Biblical structural models and their supporting

hermeneutical models, together with the actual practice, require a full-scale

study oftheir own. Only the Biblical injunctions are presented here.

The Biblical Injunctions:

(i) The Old Testament

Ifyou lend money to any ofmy people with you who is poor, youshall not be to him as a creditor, and you shall not exact interestfromhim.-Ex. 22:24.You shallnot lend upon interest to your brother, interest on money,interest on victuals, interest on anything that is lent for interest. Toa foreigner you maylend upon interest, but to your brotheryou shallnot lend upon interest; that the Lord your God may bJess you in allthat you undertake in the land which you are entering to takepossession ofit.- - Dr. 23:20-21.

44

And if your brother becomes poor, and cannot maintain himselfwith you, you shall maintain him; as a stranger and a sojourner heshalllive with you. Take no interest from him or increase, but fearyour God; that your brothermaylive beside you. Vou shallnot lendhim vour monev at interest, nor give him your food for profit. 1 amthe Lord your God, who brought you forth out ofthe land ofEgyptto give you the land ofCanaan, and to be your God - Lev. 25:35­38. 69

(ii) The New Testament

The New Testament does not contain a detailed financial code of

behavior7o. The later Church teachings relied on the Old Testament

prohibition on usury. The New Testament mentions interest only in the

two accounts of the parable of the talents, in Mt. 25:27 and Lk. 19:23. The

parable simply incorporates the common Graeco-Roman practice of

receiving interest, without any statement either for or against its

morality.71

THE QUR'ANIC/SUNNAIC STRUCTURAL MODEL

The Qur'anic/Sunnaic Structural Model, is the second and the last

of the divinely ordained prohibitory models of riba. Since it is the main

topie of this study, it is presented in detail in the next chapter along with

the associated hermeneutical models. Only the prohibitory injunctions are

presented and examined here.

69 Italics mine.70 Paul S. Mills, "Shou1d Interest Exist?" (Ph.D. diss., Cambridge University, 1994), 14.

45

The Qur'iillic Injunctions

A review of the relevant verses ofthe Qur'an, quoted by aIl exegetes

and jurists, with minor differences of emphasis in interpretation, and

translated below indicates that chronologicaIly the Qur'anic prohibition of

ribi came in four stages:

(a) Disapproval:

Ribâ is declared to be deprived of God's blessing in Sürat al-Rüm

(Q. 30:39) which is Meccan and chronologicaIly the first in the ribi

prohibition process. Here ribi is simply disapproved, and not yet

prohibited. In terms of a possible prohibition rationale, ribi is contrasted

with zakit in the context of denial of God's blessing. In fact, as indicated

above, sorne exegetes go to the extent of arguing that this verse does not

even deal with usury/interest at aIl. They opine that here ribi does not

mean usury but rather a gift. Others maintain that the meaning of ribihere

is exactly the same as in the other relevant verses of the Qur'an. This

controversy, however, is germane not for the issue of the prohibition itself

but only for its historicity determination Le. whether the prohibition

process is ofMeccan or Medinan origin.

"That which ye lay out from ribi for increase through the propertyof (other) people, will have no increase with God: but that, whichye lay out from zakit, seeking the countenance of God, (wil1increase): it is these who will get a recompense multiplied." - (Q.30:39) - c.615 CE

71 A Van den Born and L. Hartman, "Loans," Encyclopedie Dictionary ofthe Bible, ed. L. Hartman (N.Y.:McGraw-Hill, 1963), 1361-62.

46

(b) Prohibition - Initial:

Riba is unequivocally prohibited for the first time in SUrat Ai

'hnran (Q. 3:130) which is Medinan. Here al-riba is specifically referred to

as "doubling and redoubling". This "continued doubling" is considered to

be a Meccan Quraysh practice, which, it is argued, was being envied by the

Muslims, after their defeat at Ul;.ud, as the financial cause of Quraysh

militalY superiority. In order to ward off this temptation, this referred

practice is being prohibited for Muslims' own welfare. In terms of the

meaning, al-riba here refers to a specifie usury practice, and the prohibition

rationale is stated to be true welfare and success. In fact, the liberal

exegetes mainly rely on the specificity of this verse for their argument that

the prohibited ribi subsumes only excessive or compound interest and not

benign simple interest.

"0, ye who believe devour Dot al-ribi, doubled and redoubled, andfear Al1ih so that you may (really) prosper" - (Q. 3: 130) - c.625 CE

(c) Prohibition - Reiteration

Riba is reiterated as a prohibited Jewish practice, equated with

rejection of faith, and declared punishable grievously in Sürat al-Nisi' (Q.

4:161) which is aiso Medinan. The prohibition and the punishment here

though specifically for the Jews, apply to the Muslims as weIl, not directly

but by implication. The meaning of the terrn al-ribi is not defined, nor

47

reference made to any specifie type of practice. The prohibition rationale

appears to be the rejection of Faith. Noteworthy is the fact that a

punishment is provided for the first time for the violation of the

prohibition. As pointed out above, in this verse, taking ribii and devouring

of wealth are cited as two distinct practices of the Jews, both of which are

equated with rejection of Faith, and held grievously punishable, without

any explicit causallink between the two practices. Hence rejection of Faith

appears to be the implied rationale for the prohibition.

''And they took al-ribii though t/ley were forbidden; and theydevoured peoples wealth wrongfully. We have prepared for thoseaJnong them who reject Faith, a grievaus punishment." - (Q. 4:161)-c.626CE

(d) Prohibition - Comprehensive and Final

In a tone of comprehensiveness and finality, al-riba is contrasted

with al-~adaqiit in terms of loss of AŒih's blessing. And further,

foundationally, al-ribii is contrasted repeatedly with al-bay' in terms of

strict denial of similarity, and prohibited, with specifie punishment of

Satanic insanity and eternal Hell-Fire for treating the two practices as

similar. Further punishment of war from God is ordained for violation of

the prohibition. These prescriptions are contained in Sûrat al-Baqarah (Q.2:

275-279), which are very late Medinan verses. The meaning of the term a1-

riba is not specified directly; only implied through contrast with al-~adaqiit

and al-bay'. The rationale for the prohibition is not spelled out; it is only

implied to be rejection of belief, and further implied through provision of

48

severe punishrnent in the Hereafter. A tradition is aseribed to Caliph 'Umar

to the effeet that the Roly Prophet did not live long enough after the

revelation of these verses to have been able to explain the meaning of these

verses.

"Those who devour al-ribi will not stand except as stands onewhom the [Satan] by his touch hath driven to madness. That isbecause they say: "sale [bay'j is like ribi, but Allah hath permittedsale and forbidden ribii. Those who after recciving direction Fromthcir Lord, desist, shall be pardoned for the past; their case is forAllah to judge. But those who repeat (the offcnce) arc companionsofthe Fire: they will abide therein for ever. "

- (Q. 2:275) - e.632 CE

"Allah deprives al-ribi of all blessing but blesses al-$adaqit withgrowth. andAllah loveth not those who arc ungrateful and wicked "

- (Q. 2:276) - e.632 CE

"0, ye who believe! Fear Allah andgive up all outstanding al-ribiifye arc indeed believers. " - (Q. 2:278) - e.632 CE

"Ifyou do it not, take notice ofwar from Allah and His Messenger.But ifye turn repent, you shall have yourcapital sums; deal notunjustly, and ye shall not be dealt with unjustly." - (Q. 2:279) ­e.632 CE

The Sunnaie Injunetions

The prohibition of riba is both Qur'arne and Sunnaie. In addition to

the Qur'anic verses cited above which are taken by many scholars to be the

basis of ribi al-nasJ'ah, there are a number of Prophetie al;.iclJth dealing

with the extension, elaboration and prohibition of riba which are taken by

them as the basis for the prohibition of ribi a1-fa41 The famous and often-

49

quoted are:

• From 'Ubidah ibn a$-$iimit, who sakI, "The Messenger ofAllih sakI,'Gold for gold, siJver for silver, wheat for wheat, barley for barley,dates for dates, salt for salt, like for like, jp equal weights, fromhand to hand Ifthese species differ, then, sell as you like, as longas it is from hand to hand II/Reported by Muslim.

• From AbüHurayrah , who said' "The Messenger ofAlliih said,Gold for gold, weight for weight, like [or like. Silver for silver,weight for weight, like for like. Ifone gives in excess or acquires anexcess, it is ribii "Reported byMuslim.

• 'Abd al-RlÙJ.min ibn Ab]Bakrah from his father, who said:"The Prophet proscribed the sale ofsilver for silver, gold for gold,except equal for equal, andhe ordered us to sellgold for silver, andsilver for gold as we liked "

• From Jibir, who said'"The Messenger ofAlliih has cursed one who charges ribii, he whogives it, one who records it, and the two witnesses; and he said,'They are all equal. ,,, Related by Muslim. In al-Bukhiii, simiJartradition from AbüJu1}.ayfah.

• From al-Mustadrak: The Prophet said," Ribi is ofseventy kinds, the least ofwhich is as bad as marryinghis own mother[incest}. "

These Qur'anic verses and lÙJ.idfth are the foundation on which and

from which the structural features of the Qur'anic/Sunnaic Model are

derived and presented in the next chapter.

50

CHAPTERIII

THE ISLAMIC MODEL

Before presenting and evaluating the traditional and the liberal

hermeneutical models, the salient structural features of the prohibitory

model derived from an objective study of the riba prohibitory injunctions,

contained in the Qur'anic verses and Prophetie a1Jicfith quoted above, are

presellted here. For ease of reference it may be labeled the

Qur'anic/Sunnaic Structural Model.

l.The Qur'anic/Sunnaic Structural Model

1.1 Prohibition

The prohibition is graduaI but ultimately unequivocal and strict as

reflected in:

• Initial Status Quo - represented by the period between 610 CE (start of

Revelation) and c. 615 CE generally regarded as the date of the first

riba verse Q.30: 39.

• First Disapproval- expressed, c. 615 CE, in Q.30: 39.

• First Prohibition - expressed, c.625 CE, in Q.3: 130.

• Further Reiteration - expressed as reminder of the earlier Jewish

prohibition in Q.4:161, c.626 CE.

• Final Prohibition - expressed, c.632 CE, in Q.2: 275-279.

51

1.2 Meaning

1.2.1 Generic Meaning

The Qur'anic usage of the tenu rabilriba- conveys the meaning of

addition, excess, growth, as revealed in the various verses cited above.

1.2.2 Contextual Meaning

The Qur'an uses the tenu af-riba in the prohibitory verses, but without

assigning any explicit definite meaning to it. One contextual usage in the

Qur'an, af-liba a(j'ifan mucji'fatan (riba doubfing/redoubling) and the

juxtaposition of riba with rü'üsu amwifikum (capital, principal) conveys the

meaning of financial increase. The only other contextual use referring to the

Jewish practice of riba only mentions riba without specifying any particular

meaning or fonu. While generally believed to refer to their financial practice, it

could have a broader meaning.

1.2.3 Definition

The Qur'an does not provide any definit ion of riba. ft only contrasts

riba with ~adaqa (2:276), with zakit (30:39) and with bay (2:275). There are

Sunnaic indicators of the existence of riba in exchanges involving similarity of

genus.

52

1.3 Application

1.3.1 Generic Application

The verb raba has been employed in the Qur'an, as detailed above, to

indicate a process relating to earth (growth), to hill (rising), to foam

(swelling), to wealth (increase, prosperity), to child (nurturing), to nation

(augmentation), to God (power, increase).

1.3.2 Contextual Application

The concept of riba has been contextuaUy employed in the Qur'an, as

detailed above, as a financial growth process (usury/interest).

1.4 Rationale (Qilanah)

The Qur;ân does not provide any explanation, or even explicit mention, of

the rationale (/Jikmah) underlying the prohibition and the punishment for

violation. It only contrasts ribi with ba;!' (Q. 2:275) declaring one as 1}arim

and the other as iJaliil, in association with Satanic Insanity and HeU Fire

punishment for equating the two terms. The contrast of ribi with ~adaqa (Q.

2:276), and with zakit (Q. 30:39) is only an indirect indicator of the rationale

for the prohibition. The Sunnaic equivalence of ribawith incest with one's own

mother is a very stark contrast, but the underlying cause for the equivalence,

the ratio legis ( tilla), is not clarified.

53

1.5 Underlying Cause (ratio legis: 'illa)

The Qur'an/Sunna do not provide any definite pointers to the 'illa, the

underlying cause, of ribi, which could be applied to distinguish ribawl from

non-ribawl. A large number of differing 'iJal, as many as nineteen,72 have been

discovered by the classical jurists from the famous ribawlcommodities 1}adIth.

Sorne of these 'iJal are similarity, weighability, countability, measurability,

storability, valuability and edibility of the commodities.

1.6 Punishment

The Qur'an ordains strict ecclesiastical punishment for violation of the

riba prohibition in the form of Insanity, Extermination, War from God,

Infidelity, and etemal Hell Fire. There is no express mention of any temporal

punishment. There is Sunnaic condemnation of all participants of the riba

process, without specifying any punishment, and there is the Sunnaic

equivalence of ribawith incest with one's own mother, implying the associated

punishment.

The Ijtihiidic Task

These guidelines and wamings gleaned from the Qur'an and the Sunna have

posed an ijtihadic challenge to:

72 Nyazee, The Concept ofRibiand Islamic Banldng 68.

54

• Discover the distinguishing characteristic of riba that sets it apart from $adaqa,

zakiit and particularly from bay"

• Discover the fJilanah and derive the 'illa of ribËJ from the identified

distinguishing characteristic

• Delineate the meaning and scope of the term riba in the light of the identified

distinguishing characteristic, the !JilanaiJ and the tilla

• Develop a comprehensive juridical definition of the term ribii in line with the

above

• Develop the application criteria to differentiate the ribawl and non- ribawl

transactions, based on the discovered 1}ilanah and the derived tilla.

This ijtihiidic task has been pinpointed by Professor Frank E. Vogel:

"The question arises, why, if such transactions [ribâ] meetwith the approval of both parties (tradin), are they divinelydisapproved? The Qur'ân asks this very question, but in a morepenetrating way - why is sale [bay'] not like riba-? - and gives theemphatic, if obscure, answer that God has allowed the one andprohibited the other. Given the question and the response, itbecomes morally urgent ta be able to distinguish ribâ from ordinarytrade. What sorts of "increase" or inequality in exchange transformlawful commercial gain into condemned usury, despite bath parties'ready consent? In what circumstances does the desire for gainbecome perverted and corrupt? Unfortunately, the answers to thesevital questions have never been easy. The Caliph 'Umer reportedlylamented that the Prophet never spelled out the full scope of ribâ:

['Umer said,] The last verse revealed was the verse of ribii,and [then] the Messenger of God was taken [in death]. He had notexplained it to us. Sa leave ribâ and doubt [ribah]." 73

73Frank E. Vogel, and Samuel L. Hays, III. Islamic Law andFinance: Religion, Risk andRetum (TheHague: Kluwer International, 1998),63.

55

The Muslim Traditional and the Liberal Models which have

addressed the ijtihiidic task from many diverse angles are now presented.

The following chapter will present this writer's evaluation of the

hermeneutics of these models. Only the presentation of the structural

characteristics of these models here, and not the analysis, draws heavily

and liberally on the work of Nyazee.74

2. The Muslim Traditional Hermeneutical Model

2.1 The Proponents

The Traditional Model has the support of many classical scholars75.

Prominent among these, in alphabetical order, are: Abu Hamid al-Ghazali

(d. 505/1111), Ahmad b. I:fanbal (d. 241/855), Abu I:fanlfii (d. 150/767),

Mu1}ammad AmIn ibn 'Uthman ibn 'Abidin, (d. 1258/1868), Abû

Mu1}ammad 'Abd Allah ibn Sa'1d ibn I:fazm (d. 456/1064), Abu al-Walid

Mu1}ammad ibn A1}mad ibn Rushd (d. 595/1198), Abu Bakr A1}mad ibn 'Ali

al-Ja~~as al-Razi (d. 370/981), Abu Bakr ibn Mas'ud al-Kasanl (d.

587/1189), Anas b. Malik (d. 179/796), Shihab al-Dln Abu al-'Abbas

74Imran Ahsan Khan Nyazee teaches Islamic law at the Shari'ah Acaderny, International IslamicUniversity, Islamabad and is also associated with the local chapter of the International Institute of IslamicThought, Virginia, USA. He has authored rnany books on Islamic law and is the translator ofIbn Rushd'sBidiiyat al-Mujtahid, published as The DistinguishedJurist's Primer. The works relied upon here includehis The Concept ofRibiand Islamic Banldng, (Islamabad: Niazi Publishing House, 1995) and his IslamicLaw website on which he has made available for the researchers the entire 532-page 1999 judgernent ofthe Shariah Appellate Bench of the Pakistan Suprerne Court on the issue of riba, and his unpublishedEnglish translation of Zalà al-Œn Badawl's Nazarlyiit aJ-Ribii aJ-Mu1;J81Tam (Cairo: 1940) , and hisEnglish translations of extracts from the works of al-Ja~~as and al-Sarakhsi on ribËJ and bay'.75 The works of the above-named authors containing a treatrnent ofriba are given in thebibliography.

56

A4mad ibn Idiis Qaâifi (d. 684/1285), Shams al-Dln Mulfammad ibn 'Abü

al-'Abbas al-RamIi (d. 1004/1595), Fakhr al-Dln al-Razl (d. 606/1209),

Mu1}ammad ibn Isma'Il al-~an'anl (d. 211/826), Abü Bakr Mulfammad ibn

Abl Sahl al-Sarakhsl (d. 483/1090), Mul}ammad ibn Idds al-Shafi'I (d.

204/820), Abü Islfaq Ibramm ibn Müsa al- Sha!ibl (d. 790/1388), and

Mulfammad ibn al-ijasan al-Shaybanl (d. 189/805).

The Traditional Model has the support of many main stream

contemporary exegetes and scholars as weIl. One of the prominent among

these is Abül A'la Mawdüdi (d. 1979).76

2.2 The Model

The Muslim Traditional Hermeneutical Model of the Islamic

doctrine of riba prohibition has been developed mainly by the classical

fuqaha' and supported by many contemporary scholars, both named

above. Theil' individual presentations differ in detail - too many to

summarize here. But the summarized collective model essentially

maintains that:

Il ribi literally is "excess", and technically a "financial excess"

Il riba covers aIl forms of financial increase --whatever the

nature or the source

Il ribi is prohibited strictly and unequivocally by the Qur'an

supplemented by the Sunna, without anyexceptions

57

• ribihas a ritual obedience and/or an economic, social, moral

and spiritual rationale for prohibition

• ribi prohibition violation is gravely punishable

ecclesiastically

• ribi extension beyond the named six commodities is a point

of disagreement amongst the various schools of law.

A review of the available literature in translation and

commentary indicates complete agreement of the classical fuqahi' on

the essential features of the scriptural prohibition as summarized above.

Presentation of individual explanations would amount to repetition.

Their consensus, cast in modem terms, is that the prohibition covers

compound interest, simple interest and other types of ribi.77 The only

significant difference of opinion among the classical fuqahi' concems

the derivation of the detailed rules ('il1a) of ribifor the extension of the

prohibition, as detailed below.

2.3 The Method

The method of interpretation employed by the classical fuqahi',

forming the majority of the traditionalist group, and their identification

of the source of the prohibition is distinguished by their conforrnity with

76 His work on libii(süd) is given in the bibliography.77 Nyazee, The Concept ofRibii and Islamic Banking, 17.

58

the u$ül al_fiqll.78 Accordingly, they treat the Qur'an as supplemented

and elaborated (bayin) by the Sunna as one sourçe, and not the two,

separately and independently of each other, as two sources. Thus they

interpret the prohibition of riba as a single, single-sourced prohibition.

They maintain that the only source of prohibition is the Qur'an and that

the afl.adith are only elaboratory in nature, re-enforcing the Qur'anic

unequivocal prohibition, which is comprehensive and covers aIl "excess"

(riba) whether arising through nasJ'ah (delay), the so called Qur'anic ribii

al-nasJ'ah, or through qadr (estimation - weight, measure, count), the so-

called Sunnaic ribii al-tàcfl It is this method of interpretation that sets the

traditionalists apart from the liberals in the matter of the coverage of the

prohibition.79

2.4 The Meaning and The Application

The Model employs the literaI meaning of the term riba as

"excess,,80, but the various shades of meaning and applications of this

term used in the Qur'an, as illustrated above, do not find any treatment in

the Mode!. In the development of the Model, the focus of attention

immediately narrows down to only the contextual financial/economic

connotation of the term Le. usury/interest and other commodity excess.

7K Ibid.79 Ibid., 8.KO al-Sarakhsl, aJ-Mabsü!. vol. 12, 109.

59

81 Ibid.

In the juridical definition of the term, rib7J is equated with excess without

counter value8l, but the concept is not developed further.

2.5 The Coverage of the Prohibition

The classical fuqah7J', as explained above, basing their exegesis on

the U$ü] al-11qh and treating the Qur'an as the single source and the Sunna

as its elaboration, and treating the Qur'anic usage of the term rib7J as a

generic usage and requiring the bayiin (explanation) from the Sunna, treat

the rib7J prohibition, in the economic sphere, as aIl encompassing and

consequently, covering aIl forms of financial increase Le. both ribii a1­

nasl'all and ribii a1-fa(:jl.

2.6 The Treatment of the Prohibition

The Model treats this financialleconomic excess as strictly

and unequivocally prohibited. It treats the prohibitory injunctions

and their supporting verses as mu1Jkamiit and not as mufashiibihiit. It

does not recognize benignancy of the charge, mutual agreement of

the parties, or need/necessity as grounds for any exceptions from the

ambit of the prohibition.

60

2.7 The Rationale (1Jilanah)

As to the rationale for the prohibition of riba, sorne traditional

scholars regard the observance of the prohibition as a matter of ritual

obedience.82 Therefore for them the discovery of the rationale of the

prohibition is not required or necessary. But, the majority of the

traditional jurists seek both the 17ilanah and the' i1ia of the prohibition83.

In line with the adoption of the contextual financialleconomic meaning of

the term, these scholars attribute economic, social, and the associated

moral and spiritual factors as the governing principles of the 17ilanah. The

word 'exploitation' could perhaps be used as a catchall term to capture

this wide spectrum of rationale very nearly completely. In dealing with

this rationale of exploitation, the Model, however, does not address the

question of the benignancy of the charge, or the presence of mutual

agreement of the parties.

2.8 The Underlying Cause (ratio legis: 'i1ia).84

The Traditional Model has accorded an extensive treatment - with

internaI significant disagreement - to the question of the ratio legis (' i1ia)

of the 17ulan of prohibition of ribawl commodities. The famous ribawl

commodities 17adJth of the Roly Prophet, quoted above, has identified

only six commodities (gold, silver, wheat, barley, dates and salt). The

82 Nyazee, The Concept ofRibiiand Islamic Banldng, 104.83 Ibid.

61

iJadIth has not c1arified whether the riba rule is restricted to these six

narned commodities or is extendable to other commodities as weIl, and if

so, what are those other commodities and how are they to be ascertained.

What is the ratio legis (' illa) to be applied for the extension of the iJulan

ofprohibition?

Sorne jurists, like the Ziihir1s, restrict the prohibition to the six

narned commodities only, on the basis of their rejection of qiyiis as a

valid source of law.85 Majority of the fuqahii, however, agreed on the

permissibility of the extension of the prohibition and employed qiyiS

(analogy) as the rnethod of extension. Sorne fuqahii sought the extension

through qiyas al-ma 'na (applied in the presence of higher or Jower order

literai meanings of the word under examination}.86 Others sought it

exc1usively through qiyas af- 'iiJa (applied in the presence of equivaJent

meanings of the word under examination) requiring the discovery of the

'i1la. 87 The discovered 'illa, however, is different according to the various

schools oflaw (madhiihib).

The I:Ianafi jurists consider the similarity of species and the

similarity of the method of estimation (qadr- but limited to weight and

rneasure only, exc1uding count) to be the 'i1la (as two factors) in the

ribawl c'ommodities iJadIth. When both factors are present, there is

H4 The following presentation of' illa is based on the work of Nyazee (67-71). These juristic differences ofopinion are detailed in many works ofIslamic fiqh including e.g.Ibn Qudamah, al-Mughnl. vol. 4, 124­127,gS Ibn J::Iazm, al-MuiJalra, viii, 468.86 Nyazee, The Concept ofRibiiandlslamie Banldng, 68.87 Ibid.

62

prohibition of both excess in weight/measure (ribi al-facjl) and delay in

delivery (ribi al-nasJ'ah). When only one factor - similarity of estimation

method - is present, excess in weight/measure (ribi al-facjl) is permitted

but delay in delivery (ribi al-nasJ'ah) is prohibited. When both factors ­

similarity of species and similarity of method of estimation - are missing

(Le. dissimilarity of species and dissimilarity of methods of estimation),

both excess in weight/measure and delay in delivery are permitted,

enabling credit sales (buyii' al-nasJ'ah). Further sub-classifying the

weight factor into two different categories (smaIl weights for precious

metals and large weights for baser metals), the ijanafi jurists extend the

lj.ukm of ribi to aIl precious metals, aIl base metals, and aIl foods that

are measurable (by volume). Every thing sold by counting, at the time of

the Roly Prophet, is exempt from the prohibition.

The Shafi'i jurists treat currency-value (in the case of gold and

silver) and food-value (in the case of wheat, barley, dates and salt) to be

the 'illa. Accordingly, the riba prohibition extends to aIl precious metaIs

with a currency value and to aIl eatables.

The Malik1 opinion is the same as that of al-Shafi'i, with the

qualification of the food attribute by the additional requirement of

storability. The ribi prohibition extends to aIl storable food, and not to

perishable food.

The ijanbali jurists subscribe to the ijanafi opinion, but extend

the prohibition to countable items as weIl.

63

The Zahir! jurists, as pointed out above, limit the riba prohibition

to the six named commodities on the basis of their rejection of qiyis as a

valid source of law. Therefore the identification of the 'illa is irrelevant

for them. Extension of the commodities is, however, possible for them

through the implications of the meanings.

The above summary ofjuristic opinion on the identification of the

'illa of the 1}.uhn of ribi prohibition is a simplified version of the

otherwise more detailed and complex treatment of the subject by the

fuqahi'.

2.9 The Consequence

FinaUy, the Traditional Model recognizes the directly named

ecclesiastical punishments for the violation of the riba prohibition,

prescribed directly in the Qur'an as Insanity, Extermination, War from

God, Infidelity, and etemal HeU Fire. There are no primary-sourced

prescribed temporal punishments. However, the Model incorporates what

is reported to be a set of secondary-sourced temporal punishments. Based

on the last words of the verse Q. 2:279, juristic opinion reportedly

provides for exercise of compulsion on the offender to abandon riba, and

in case of persistence, the majority of such opinion caUs for his

imprisonment till abandonment, while even his execution is caUed for in

the opinion of Ibn'Abbas, Basan al-Ba~r!, and Ibn S'irln.88

88 Gauhar, Translations From The Quran , 136.

64

2.10 Contemporary Juridical Support

In the contemporary juridical scenario, in essence, in terms of the

banning of aIl forms of financial excess, the Traditional Model finds

recent full support, among others, in the rulings of the Jeddah-based Fiqh

Academy of the Organization of Islamic Conference (OIC) and in the

judgements of the Pakistan Federal Shariah Court (FSC) and the Shariah

Appellate Bench of the Pakistan Supreme Court (PSC). The Organization

of Islamic Conference in its 1986 ruling, only recommendatory and not

juridically binding, had declared aIl forms of interest as prohibited in

Islam. 89 The Pakistan Federal Shariah Court in 1991 had dec1ared many

laws of Pakistan "repugnant to the injunctions of Islam ... for providing

for interest which falls within the definition of ribi clearly prohibited by

the Holy Qur'an." 90 Th'e Shariah Appe11ate Bench of the Pakistan

Supreme Court in 1999, dismissing the appeal of the Federation of

Pakistan, upheld the Pakistan Federal Shariah Court 1991 judgement and

declared a11 forms of interest to be strictly prohibited by the Holy Qur'an

and the Sunna. 91

X9 Fiqh Academy, Organization Islamic Conference, Jeddah.90 Judgement of the Pakistan Federal Shari'ah Court ofNovember 14, 1991. Reproduced. (Lahore:Pakistan Law Digest (PLD) Publishers, 1992).91 Judgement of the Shari'ah Appellate Bench of Pakistan Supreme of December 23, 1999. (Islamabad:Advanced Legal Studies Institute, (www.nyazee.com). 2000), 532.

65

3. The Muslim Liberal Hermeneutical Model

3.1 The Proponents

The Liberal Model has the support of at 1east two classic scholars

and many contemporary exegetes and scholars.

Prominent among these are the classic scho1ar Ibn 'Abbas (b. 622

CE), Olle or the most prominent Companions of the Prophet, who is

claimed to have dispensed with the ribi al-facjl prohibition, on the basis

of aJ:!.otbt.r~ladJthof the Holy Prophet declarlng ribi al-nasJ'ah as th~

only ribii.92 The other classic scholar supporting the liberal group is Ibn

HI-Qayyim (d. 75111350).

Prominent contemporary scholars in this group are Mu1}.ammad

'Abdul1 ,(d. 1905), Rashid Riq.ii (d. 1935), Abü Zahrah (d. 1974), 'Abd ar­

Razûk as-8anhurl (d. 1971), Ibrailim Zald ai-Badawi , and Fazlur

Ral}miin (d. 1988), to name but a few.

3.2 The Model

The Muslim Liberal Madel cannot correctly be 1abeled as a

homogenous set of thought. Tt is an umbrella category incorporating a

diversity of opinion of contemporary scho1ars divided roughly a10ng the

lines of the two main constituent sub-groups, the contemporary religious

scho1ars and the contemporary secular scholars, and further compounded

by individual differences of opinion within each of the two sub-groups.

6n

The representative views of the group contained in the depositions of Ibn

'Abbas, Ibn al-Qayyim, Muhammad 'Abduh, RashldRiq.a-, Abii Zahrah,

and as-Sanhiiii have been presented above in Chapter II. While the

contemporary religious group has the advantage of familiarity, but the

privilege of disagreement, with the methods of the Traditional group, the

contemporary secular group has only the privilege of disagreement. In

this Model, then, the only point of agreement is disagreement with the

Traditional Model. The Model seeks curtailment, dispensation and

circumvention of the prohibition. Another binding factor in the

contemporary Liberal Model is the obsessive concem with the sanctity of

modemity. The Liberal Model derives its guiding principles from the

historieal context but tempers them by the modem context. In fact, it

treats the historical context as the cradle and the modem context as the

grave for the derived principles.

As will be shown below, the Liberal Model differs from the

Traditional Model on many aspects of the prohibition. These differences

include the modifiability, the source, the binding force, the coverage and

the dispensability of the prohibition.

As explained above, this Model represents a departure from the

Traditional Mode!. Renee, points on which this Model does not record

any dissent, although notpositively stated by it, are regarded as being

common between the two Models and are presented accordingly.

92 Ibn Rushd, Bidayat af-MujtafJid wa-NilJiiyat af-Muqta$id trans. Irnran Ahsan Khan Nyazee, The

67

3.3 The Method

The method of Interpretation employed by the contemporary

scholars and their treatment of the sources differs from that of the

classical fuqahi,.93 In complete disregard of, or non-familiarity with,

ll$Ü] al-Bqh, they treat the Qur'an and the Sunna as two separate,

independent sources, with the Qur'an as the primary source and the

Sunna as the secondary, non-complementary source.94 This

characterization of the Sunna as a non-complementary source carries

with it an unsupportable assertion of a lesserbinding. force for the Sunna.

Thus they interpret the prohibition of riba as a dual, double-sourced

prohibition. They maintain that only the so-called Qur'anic ribi a]-

nasl'ah is the original prohibition sourced in the Qur'an. For them it is

the Qur'anic or Primary prohibition, implying a greater binding force.

According to them the so-called Sunnaic ribi al-fag] is not sourced in the

Qur'an. It is a later extension by the Prophet of the original Qur'ànic

prohibition of ribi al-nasl'ah and is sourced in the ribawl commodities

iJadIth. It is thus a Sunnaic or Secondary prohibition, implying a lesser

binding force.

DistinguishedJurist's Primer. 2 vols. (Reading: Gamet Publishing, 1994), vol. II, 158.93 Nyazee, The Concept ofRibi andls/amic Banking, 8.

68

3.4 The Meaning and The Application

Like the Traditional Model, the Liberal Model also employs the

literaI meaning of the term ribâ as "excess", and, similarly, the various

shades of meaning and applications of this term used in the Qur'an, as

illustrated above, do not find any treatment in this model as weIl. In the

evolution of this Model too, the focus of attention immediately narrows

down to only the contextual financialleconomic connotation of the term

- usury/interest and other commodity excess.

3.5 The Coverage ofthe Prohibition

The liberal scholars have a point of agreement with the classical

fuqahi' that the prohibition, in its technical sense, applies to

financial/economic increase and therefore both ribi aJ-nasl'ah and ribi aJ­

facjl are prohibited. But they have a point of disagreement with the

traditionalists on the source and the resulting binding force of the

prohibition that serves to narrow down the coverage of the prohibition.

Thus even within this narrow financialleconomic connotation, there is a

further narrowing of scope. The model treats the Sunnaic ribi aJ-facjl as

altogether excludable from the coverage of the prohibition on the basis

of the doctrine of Sunnaic lesser binding force. Even within what is

termed by them as the ribi of the Qur'an, the Liberal Model, as a group,

relying on the contextuality of one of the Qur'anic injunctions, and on

94 Ibid., 11-13.

69

the economic rationale for the prohibition, limits the prohibition to

compound interest and interest on consumption loans, but that too

dispensable on the basis of the doctrine ofnecessity. It exempts from the

prohibition simple interest and interest on production loans as being non­

exploitative. Another view regards the prohibition as being applicable to

usury and not to interest Le. only to the modern context of excessive

interest, and not to the modern day bank interest.

For the limitation of the prohibition to compound interest,

reliance is placed on the "ribii doubled and redoubled" verse of the

Qur' an, thus employing the specificity of the verse and ignoring the

generality of the other ribii prohibitory verses which employ a generic

usage of the term ribii.

3.6 The Treatment of the Prohibition

The Model treats this narrowly defined financial excess as not

strictly 'prohibited. One shade of opinion treats the prohibitory

injunctions and their supporting verses as mlltashiibihiit and not as

mu1;Jkamiit. Even when they do not subscribe ta this view, they treat the

prohibition as dispensable. They consider the prohibition on simple

interest and interest on production loans as dispensable on the basis of

rationale (non-exploitative). They consider the prohibition on ribii al-facjl,

if not altogether exdudable, then at least dispensable on the basis of the

doctrine of need. Finally, they consider the prohibition on compound

70

interest or usury and on interest on consumption loans as dispensable on

the basis of the doctrine of necessity. One extreme opinion even regards

the ribii al-jiil;.iliyya as allowed in case of 'pressing necessity' and ribii al­

fat/l and ribii al-nasl'ah as allowed in case ofneed.95

The Model recognizes benignancy of the charge, mutual

agreement of the parties, and necessity as grounds for inapplicability of

the prohibition. Tt regards the prohibition itself as subject to

interpretation and modification.

3.7 The Rationale (1Jilanah)

Operating within the confines of the Traditional Model, the

Liberal Model also contextually employs the economic, social, moral and

spiritual rationale as the explanation for the prohibition. But, as a major

point of departure, adding precision and refinement to the concept, the

LiberaIs make a very effective use of the catchall term 'exploitation'. In

dealing with this rationale of exploitation, the Model pointedly raises the

question of the benignancy of the charge, and of the presence of mutual

agreement of the parties. Tt makes the obvious, simple, yet powerful

point that if the charge is benign and/or mutually agreed, it is not

exploitative and, if exploitation is the rationale for the prohibition then,

whatever is non-exploitative is not covered by the prohibition. This line

95 Sanhürl, Ma~iidir al-I:faqq, ml. III, 237.

71

of argumentation accentuates the need for the discovery of the true

rationale for the divine prohibition.

3.8 The Underlying Cause (ratio legis: 'illa)

The Liberal Model has not identified the ratio legis (' illa) of the

ribawl commodities on the pattern adopted by the Traditional Model. It

appears that the Liberal Model makes no distl;nction between the

concepts of J;.ihnah and 'ilia. It uses the two terms interchangeably, and

as shown above, employs the concept of exploitation to refer to J;.ihnah

and 'ilia both. However in one shade of liberal interpretation, to coin a

new term, "conformity with historieal praetiee" appears to have been

used as the 'ilia. This view regards the historieal praetiee of ribi aI­

jiihiliyya as the only prohibited ribi and contends that, only what

conforms today to the historical practice of ribi al-jiihiliyya is prohibited,

and whatever does not eonform to this praetiee is exempted.

3.9 The Consequence

The Liberal Model, like the Traditional Model, recognizes the

directly named ecclesiastieal punishments for the human violation of the

ribi prohibition. There is no room for interpretation or disagreement on

these punishments -- Insanity, Extermination, War from God, Infidelity,

and eternal HeU Fire. These are clearly and direetly ordained in the

Qur'an; They also recognize that there are no primary-sourced preseribed

72

temporal punishments and the secondary-sourced punishments were

advocated only by a minority of the Traditional group.

3.10 Contemporary Juridical Support

In the contemporary juridical scenario, in terms of liberalizing the

riba prohibition, support for the Liberal Model cornes chiefly from the

civillegislation ofmany Muslim countries themselves.

73

CHAPTERIV

CONCLUSION

In the light of the meaning, the regulatory framework and the

structural and hermeneutical aspects of ribi prohibition examined above,

a critical hermeneutical evaluation of the Muslim Traditional and the

Liberal Models in terms of their employment of the meaning, application,

rationale, underlying cause and consequence of ribâ, can now be

attempted in order to summarize the hermeneutical imbalance leading to

the concluding recommendation.

A survey of the exegetical literature indicates that there is

unanimity of opinion amongst the traditional and liberal exegetes and

jurists on the literaI and lexical meaning of riba as "excess, growth,

addition." Thus, whHe there is no apparent Arabic linguistic problem, the

Models either do not recognize at aIl or, more simply, do not express the

intrinsic distinguishing characteristic of the "excess, growth, addition"

which is being referred to. The Models do not answer sorne fundamental

questions raised by many scholars. Does riba refer to every, or only to a

specifie, type of "excess, growth, addition"? What sets riba apart from

ba;!? What makes riba iJarim and bay' iJalal! And above aIl, what is it

that attracts Satanic insanity for confusing the two terms with one

another? Surely, a simple inability to comprehend the commercial

distinction between two seemingly commercial terms can easily be a case

74

of ignorance of commercial knowledge, and cannot be so serious as to be

equated with Satanic behavior and punishable with etemal HeU Fire.

Conversely, in the modem vemacular, a d~gree in commerce, finance, or

law, of itself, cannot be a passport to Heaven. And surely, indulgence in

one seemingly commercial activity cannot be such a grave sin as to

imperil such grave punishment as etemal Hell Fire. What, then, is the

veiled layer of meaning beyond the apparent commercial meaning that

attracts such punishment? As will be shown below the absence in the

Models of an adequate treatment of the above questions has a very

profound bearing on the very meaning of the term w~th all the consequent

misconceptions, which is what makes riba appear to be the supreme of aU

the 'Quaestiones Vexatae' of Islamic Law. This lack of precision of

meaning represents the first hermeneutical flaw in the Models.

In spite of the above-referred agreement on the lexical meaning of

riba as "excess, growth, addition", the focus of attention of both the

traditional and the liberal exegetes and jurists immediately narrows down

to the economic/financial application of the term in varying degrees as

shown above. Accordingly, attempts are made to confine the term to

economic/financial excess arising out of delay or estimation, and to

equate it with the English language terms of usury or interest or both. In

these Models, this confinement of the application of riba to only the

economic/financial aspect of human activity is quite understandable in

the light of at least two factors. Firstly, in the historical context of

75

Revelation (the mercantile character of the immediate recipients - the

Quraysh- and of their habitat - Mecca), the commerciaVfinancial

/economic aspect was the most readily discernable, identifiable and

prevalent candidate for the first application of the term ribà as a process

of growth. Secondly, on a more specifie plane, the Qur'an, following its

contextual approach, uses the term ribà in its economic application when

it refers to a prevalent Arab financial practice of 'riba doubling and

redoubling' (3: 130), or conceptually, when it contrasts riba with $adaqa

(2:276) and with zakit (30:39). The Qur'an also contrasts ribà with bay'

(2:275). This contrast appears, at first sight, to be clearly, and only, a

further economic application, and serves as the hermeneutic foundation

of the current riba models. But this ribilbay' contrast does not have the

exclusive economic connotation that is claimed for it. This contrast has a

very profound esoteric connotation, which, as will be expounded later, is

the hermeneutic foundation of the Qur'anic/SunnaicModel. However,

even setting aside this question ofinterpretation ofQ. 2:275, in any case,

still there is ample Qur'anic source material and Arab customary usage to

link riba with human economic activity. However, this does not mean

that ribà, with its generic meaning of "excess, growth, addition", is

confined to the economic sphere only. As a matter of fact the Qur'anic

usage of the term, as detailed above, conveys at least six different shades

of meaning which identify the presence of the process of ribà in many

other spheres.

76

FUlthermore, the Prophetie iJadith, equating ribâ with incest,

quoted above, refers to the existence of seventy different kinds of ribâ.

Clearly, not àll these kinds belOllg exclusively to the economic sphere.

Even within this narro,,,, financial/economic applicaticn, the

Liberal thought attempts to dowugt'ade or reject sorne applkations

which the Traditional thought regards as covered by the prohIbition.

Fir~tly, the Liberal downgrading of the n'bi al-faq! as a secondary lesser

binding prohibition is not defensible either proeedurally or

eonceptually. Procedurally, it is in violation of u$ül al-fiqh for not

treating tte Qur'an and the SU1lIlél as ane hinding source. Conceprually,

downgrading the ribi al-fagl nms counter to the very essence of the

r,oncept of riba . Secondly, the Liberal attempt to altogether exclude

simple interest from the prohibition net is ehallengeable. For the

limitation of the prohibition to compound interest/usury only, l'eliance

is placed by them on the "riba doubled and redoubled" verse of the

QUl"an (3: 130). Theil' argument is based on the specificity of the verse

and ignores the generality of the other rib7J prohibitory verses which

employa generic usage of the term Iibi:. The counter-argument eould be

advauced that had it been the Divine purpose to prohibit only a specifie

praetice, then the specifie Q. 3: 130 suffices for the purpose. What then

is the t~'lIget of the other generie-meaning and comparative-meaning

verses? What their interpretation ignores i8 the more plausible position

that the Qur'anie prohibition being generie is necessarily also

77

comprehensive and that Q. 3: 130 is only one example of a covered

practice familiar to the immediate audience of the Revelation. In fact,

the nature and the severity of the prescribed punishment in Sürat af­

Baqarah strongly suggests that the coverbge and the depth of the

prohibition go even further - much beyond the mere entire financial and

economic spheres. The authentic l;adlth equating ribâ with incest with

onels own mother is very suggestive of the broader import of the term

ribi and the rationale of its strict prohibition.

The lack of explicit recognition that ribâ application covers the

financial spectrum in its entirety and even goes far beyond the economic

sphere is the major factor which in the CUITent Models prevents the

synthesis of meaning, application, rationale, underlying cause and

consequence. This limitation of application represents the second

hermeneutical flaw in the Models.

The Qur'an and the lfadith, while very emphatic on ribâ

prohibition, and very cIear on the nature and severity of the eccIesiastical

punishment for its violation, are explicitly and completely silent on the

rationale (l;ilanah) underlying the prohibition and the punishment. It has

been, therefore, left to the jurists to ask what ribiis, why it is prohibited,

and how it is punished.

In Hne with their restricted economic paradigm of riba, the

exegetes have picked up the readily discemible economic connotation

cIues from the Qur'an when it contrasts ribâ with bay' and ribâ with

78

zakitl.sadaqa. Accordingly, riba is treated as the opposite of bay' from an

economic and social viewpoint and as the opposite of zakit/~adaqafrom

a related moral and spiritual viewpoint. Consequent1y, aIl the benefits

and virtues of bay' and zakit/~adaqa are seen as absent from ribii. Based

on this model, the exegetes have come up with a number of negative

effects of the practice of riba and they treat these as the rationale for the

Divine prohibition of riba. According to them, these negative effects of

riba under the economic and social category, include exploitation,

inequity, injustice, wealth concentration, economic depression/crisis, and

social resentment/anger leading to revolution, and under the moral and

spiritual category, include se1fishness, miserliness, callousness,

ungratefulness, greediness, avarice, meanness, hatred, resentment, spite

and jealousy.

While the exegetes have demonstrated the negative effects of riba

practice from the economic and the related social, moral, and spiritual

standpoints, very thoroughly, forcefully and convincingly, yet they have

not done it conclusively. They have not even attempted to prove that

these negative effects of riba are the necessary and the only concomitants

of riba, Le. riba cannot result in any thing but these stated negative

effects and that riba can never have any positive effects. While it is very

clear and has beenamply explained by them, what human effects riba as

an instrument can, and does, have in the hands of an oppressive person,

the exegetes have not even asked, let alone answered, the question what

79

human effects riba as an instrument can, and does, have in the hands of a

benign person? And, in the light of the answer to this question, what then

is the real rationale for the strict prohibition of riba and the severe

ecclesiastical punishment for its violation? They have not answered the

logical question why, if exploitation is the prohibition rationale, non­

exploitative practices - involving benign charge and/or mutual consent ­

are also c1assed as prohibited? And, they have also not even asked the

question of whether, how and why riba is applicable to other than

economiC spheres ofhuman creative activity?

These unanswered questions are further compounded by an

inadequate interpretation of the connotation of 'interaction of

similarity/dissimilarity' in the so-called ribawl commodities 1}.adith and

by virtually no explanation of the ratio legis ('illa) in the oft-quoted riba

/incest equivalence 1}.adith. This lack of identification of the rationale for

the prohibition constitutes the third hermeneutic flaw in the Models.

The derivation and identification of 'ilal (underlying causes) of

ribi prohibition has received substantial coverage particularly in the

traditional model, as examined in detail in Chapter III. This derivation

represents an impressive intellectual effort, but is narrowly conceived by

definition and design. Both models seek the tilla in the context of the

named six commodities only to extend the prohibition to other

commodities. This could be termed as a micro-level approach in the

economic sphere as against a macro-Ievel approach in the universal

80

sphere. The juristic Traditional Model seeks the distinctive

characteristics of the named six commodities but not the distinctive

characteristic of ribii itself. It ignores the essence and explores the

manifestations of the prohibition. It looks at the eharacteristics not of

ribibut of what ribii is reflected through. It diagnoses not the disease but

the patients. It concentrates on the exoteric micro level indicators of

similarity, weighability, countability, measurability, storability,

valuability and edibility of the commodities, but not the esoteric

distinguishability ofribiithat runs through the commodities. On the other

hand, the scholarly Liberal Model as pointed out above does not have a

systematic approach to the whole concept of 1J.ikmah and 'illa of ribii

prohibition.

The employment of systematic, but exoteric micro-Ievel

approach in the Traditional Model and non-systematic approach in the

Liberal Model for 'i1la derivation constitutes the fourth hermeneutical

flaw in the Models.

As indicated above, the directly named punishments, for the

violation of the riba prohibition - Insanity, Extermination, War from

God, Infidelity, and HeU Fire - aU are ecclesiastical in nature. There are

no primary-sourced prescribed temporal punishments. There is a minority

secondary-sourced punishment of death.

This punitive aspect of riba prohibition presents an ijtihiidic

challenge which in the CUITent models has not received the attention that

81

it caUs for. The dilemma to be resolved is that riba is seen as a temporal

activity, and indulgence in it is regarded as a sin. The explicitly ordained

punishment for this temporal violation is ecclesiastical only, and, this

ecclesiastical punishment is not commensurate with riba seen only as a

temporal violation. Is the punishment, then, too harsh, or is the violation

more than temporal? The punishment, being divinely ordained, cannot be

unjust. Our perception ofriba must then be at fault.

The CUITent models do not address this dilemma. They do not

respond to the following specifie questions.

Firstly, riba is seen as a temporal activity and part of the fiqh a1­

mu'iimalit but the primary-sourced prescribed punishments are aIl

ecclesiastical and not temporal in nature. As noted above, there is

reported to be a set of minority secondary-sourced temporal punishments,

but hardly any evidence of their application. However, regardless of the

validity ofthis minority juridical opinion, these temporal punishments do

not and cannot replace or abrogate the ecclesiastical punishments that are

expressly divinely ordained. The question then still remains why

ecclesiastical punishments for temporal violations?

Secondly, the prescribed ecclesiastical punishments represent the

most extreme end of the punitive spectrum, which is certainly not

commensurate with riba seen only as a violation of human economic and

social rights. Why is there such grave punishment for violation of one

(economic/social) component of 1;uqzïq a1- 'ibid when violation of any

82

other of its components does not attract such punishment? These

ecclesiastical punishments are by themselves evidence and proofthat riba

indulgence must involve a far graver sin. Even the reported juristic

opinion-based punishment of execution for riba indulgence is similarly

harsh and incompatible with the economie/social connotation as the only

manifestation.

No intellectually defensible attempt appears to have been made to

evaluate the so far humanly "discovered" rationale in juxtaposition with

the divinely ordained punishment. One unsatisfactory attempt at

reconciliation hasinvolved the raising of the status of the violation by

proclaiming that the nature of the Divine punishments shows the

importance that God attaches to human economic rights.

These unresolved points of reconciliation between the rationale and

the punishment are a further, the fifth hermeneutic flaw in the current

Models.

Based on the above analysis, the underlying hermeneutic flaw of

the Traditional and the Liberal Models of riba, can be sununed up as one

of imbalance. There is imbalance between the meaning and the

application, imbalance betweell the applIcation and the rationale,

imbalance between the rationale and the ullderlying cause, and finally

imbalance between aIl these variables and the consequence. The

hermeneutical problem is that these riba prohibition models start with the

83

generic meaning of the term, narrow it down to one sphere of activity by

relying only on the historicity, contextuality and specificity of meaning,

search for the prohibition rationale and the underlying cause in this

narrowed context, attempt to promulgate the prohibition on the strength

of this narrowed context rationale, and make no meaningful attempt to

reconcHe the rationale with the consequence. This skewness of the

models is clearly in need of alignment through the removal of this

imbalance.

This internaI balancing of the riba model requires exegetical and

juristic research to discover from the Qur'an/Sunna itself a meaning of

riba, beyond the lexical and the contextual, which is intrinsic and

distinguishing in terms of its uniqueness (tamylz), and then to formulate

a definition ofriba which in turn should represent a complete synthesis of

the meaning, the application, the rationale and the underlying cause of

the prohibition, and the consequence of violation of the prohibition.

Without this delineation and synthesis, confusion about the concept will

persist, hindering the juridical transformation from interpretation to

implementation.

84

BIBLIOGRAPHY

(A) ARABIC SOURCES

Badawl, Zakl al-DIn IbrahIm. Nli?ariyya al-Riba al-Mu/;Ianamu FI al-Sharl'a al-Isliimiyya. Cairo: Dar wa ­Matâbi' al-Sha'b, 1940. Trans. Irnran Ahsan Khan Nyazee, "TheoryofProiJibited Riba."Islamabad: Advanced Legal Studies Institute, 2000.

al-Bayçlawl, 'Abd Allah. TafsIral-Qur'in. Istanbul: Dar al-1)ba'a al-'Amira, 1886.

al-Fatawa al-Hindiyya. Beirut: Dar Il].ya'" al-Turath al-'Arabl, 1980.

Fatawa al- Imiim Mu/;Iammad Rashld Riç/i, eds. S. Munajjid and Y. Khûrl. Beirut: Dar al-Kitab al-JadId,1970,5 vols., vol. 11.

al-GhazaII, Abu f.!:amid. Shi/i' al-GiJalll. Baghdad: Matba'at al-Irshad, 1390/1971.

Ibn'AbidIn, Mul~arnmad AmIn ibn 'Uthman.lfasbiyat radd al-Mu/;Itir 'ala al-Dun- al-Mukhtir Shar{JtanwIr al-Ab~ir. Cairo: Mu~tafâ Babl al-!;Ialabl, 1966.

__. Majmü'at Rasa'il Ibn 'Abiâm. Beirut, n.p., 1978.

Ibn !;Ianbal, Al~ad. Musnad al-Imiim A/;Imad bin lfanbal Cairo: al-Matba'a al-Yamaniyya, 1895.; reprint,Beirut: al-Maktaba al-Islamiyya, 1978.

Ibn !;Iazm, Abu Mu4arnmad 'Abd Allah ibn Sa'ld. Al-Mul.Jalli. Beirut, n.p., 1978.

Ibn Qudamah al-Maqdisl, Muwaffaq al-DIn Abu Mul~arnmad 'Abd Allah ibn Alpnad ibn Mul~arnmad,

al-MughnlfiFiqiJ Imiim al-Sunna A/;Imadibn lfanbal al-ShaybinI Beirut: Dar al-Kutub al­'Ilmiyya 1979.

Ibn Rushd (Averroes), Abu al-Waiid Mu4arnmad ibn Alpnad ibn Mu4arnmad, Bidayat al-Mujtahid w.a­Nihiyat al-Muqta~id 2 vols. Cairo: Dar al-Salam, 1995. Trans. Irnran Ahsan Khan Nyazee, TheDistinguisiJedJurist's Primer. 2 vols. Reading: Gamet Publishing, 1994.

al-Ja~~a~ al- Razl, Abu Bakr A1).mad ibn 'AIT. A/;Ikiim al-Qur'in. Beirut: Dar al-Kitiib al-'Arabl, n.d.

al-Kasanl,Abu Bakr, Bada 'i' al-$ana 'i', 7 vols. Beirut: Dar al-Kitab al-'ArabI, 1982. vol. 5.

Khan, Mu4arnmad Mu4sin. $afJJfJ al-Bukhirl9 vols. Beirut: Dar al-'Arabia, 1985.

Khurufa, 'Alâ' al-Dm. 'Aqd al Qarç/Fial-Sharl'a al-Isliimiyya. Beirut: n,p., 1982.

Mâlik ibn Anas, al-Muwa,t,ta'. Beirut: n.p.,1979.

al-Marghlnanl al Rushdanf, Burhan al-DIn, 'AIT ibn Abu Bakr ibn 'Abd al-JaIII al-Farghan1. Kitab al­Hidiiya. Cairo: Matba'at Mu~tafâBabl al-!;Ialabl , 1400/1980.

Muslim, Ibn al-ijajjaj al-Nisâbür1. $afJJfJ Muslim. With a commentary by Ya4ya bin Sharaf al-Nawawl.Edited by 'Abd Allah Alpnad Abu Zinâl}. Cairo: al-Sha'b Press, n.d.

al-Nisapür1, 'Arr bin Alpnad. Asbib al-Nuzül Beirut: Dar al-Kutub al-'Ilmiyya, 1980.

Qarafi, Shihab al-DIn Abu al-'Abbas ~ad ibn Idns. Shar/;I TanqJfJ al-Fu~ül. Bulaq, n.d.

85

al-Qur'ân al-Kanm. al-MadIna al-Munawwara: Majma' al-Malik Fahd li-Tab' al-Mu~l~afal-SharIf, 1417.Trans. (1) Dr. Mul~ammad Tagi-ud-Din al-HiIaIi and Dr. Mullammad Mullsin Khan,Interpretation ofThe Meaning ofThe Noble Qur'ân. Riyadh: Maktaba Dar-us-Salam, 1996.(2) Mohammad Marmaduke Pickthal, TiJe Meanings oftiJe Glorious Koran. New York: Mentor,n.d. (3) Arthur J. Arberry, TiJe Koran Interpreted, 2 vols. London and New York: George Allen &Unwin Ltd., 1955. (4) A. Yusuf Ali, TiJe Holy Qur'an.' Translation and Commentary. Brentwood,Maryland: Amana Corporation, 1983. (5) Muhammad Asad, TiJe Message ofTiJe Qur'an.Gibraltar: Dar al-Andalus, 1980.

al-RamIl, Shams al-DIn Mu1).ammad ibn' Abü al-' Abbas. Nihayat al-MuIJ.tij ila SharlJ. al-Minhi}. 8 vols.Cairo: Mu~tafâ Babi al-ijalabI, 135711938.

al-Riizl, Fakhr al-DIn, al-Tafsir al-KabIr. 32 vols. Beirut: Dar n:lya' al-Turath al-' ArabI, 1980, vol. 7.

al-$an'iinl, Mu1).ammad ibn Isma'Il. Subul al-Salim Shar~l Bulûgh al-Marim. 6 vols. Cairo, n.p., 1987.

S~iin, 'Abd al Saliim ibn Sa'ld ibn ijablb al Tanükhl, &l-Mudawwana al-Kubra. 16 vols. Mi~r: Matba'atal-Sa'ada, 132311905.

Sll.lÙ1Ür1, 'Abd al-Razzaq. Ma$adk al-Ifaqq fi 'I-FïqiJ al-IslimI, 6 vols. Beirut: al-Majma' al-' ArabI al­IslamI, n.d.

al-Sarakhsl, Abü Bakr Mul~ammad ibn Ab1 Sahl. Kitaa al-Mabsü,t. 30 vols. Cairn: Ma~ba'at al-Sa'adah,1324-3111906-13. Reprint Karachi, 1987.

__. U$üJ al-SarakiJsl2 vols. Beirut: Dar al-Ma'rifa, 139311973.

Shafi'I, Muqanllllad ibn Id11:s, al-Umm, 8 Vols. Beirut: Dar al-Ma'Iifa, 1973.

al- Shatib1, Abü Isl~aq Ibriilùm ibn Müsa. Al-Muwafàqat fi U.sûl al-SharI'a. 4 vols. Cairo: Maktabat al­Tijariyya al-Kubra, 1975.

al-Shawkam, Muqammad ibn 'AG. Nayl al Aw,tiJ: Cairo: 'Ïsa Babi al-ijalabi, 1952.

al-Shaybiini, MlÙJ.ammad ibn al-ijasan. Kitab al-Buyû' wa-l-Salarn. Ed. Chafik Chehata. Cairo, n.p., 1954.

WaIl Alliill, Shiill, Ifujjat Allih al-BiligiJah, 2 vols. Cairo: Dar al-Turath, 198?

(B) NON-ARABIC SOURCES

Abod, Sheikh Ghazali Sheikh, Syed Omer Syed Agil, and Aidit Hj. Ghazali. eds. An Introduction toIslamic Finance. Kuala Lumpur: Quill Publishers, 1992.

Aghnides, Nicholas P. An Introduction to MoiJammedan Law and A Bibliography (MohammedanTheories ofPublic Finance). Lahore: Sang-e-Meel Publications, 1994.

Ahmad, Khurshid. [Ed.] Studies in Islamie Economies. Leicester: The Islamic Foundation, 1980.

Ahmad, Malllnood. Economies ofIslam. Lahore: Ashraf Publications, 1968.

Ahmad, Ziauddin. 'The Theory ofRibi.' In An Introduction to Islamic Finance, edited by Sheikh GhazaliSheikh Abod,Syed Omer Syed Agil, and Aidit Hj. Ghazali. Kuala Lumpur: Quill Publishers, 1992.

Ahmed, B.D. 'Ribïi in Islamic Law.' Islamic and Comparative Law Quarterly, VI: 1 (March 1986).

86

Ali, Mahfooz. 'Islamic Banking: Riba, Interest and Profit Sharing.' Joumal ofthe Institute ofBankers inPakistan. (Sep 1989).

Ali, S. V. MirAhmad. Abridged Commentary ofQur'in-e-Majeed Karachi: Peennahomed Ebrahim Trust,1975.

An~ari-Pour, M.A 'Interest in International Transaction Under Shi'ite Jurisprudence'. Arab LawQuarterly, 9:2 (1994): 158-170.

Ansari, Zafar Ishaq. Towards Understanding the Qur'in. Edited Tr. of Abül A'la Mawdüd1's TafhJm alQur'in. 6 vols. Leicester: The Islamic Foundation, 1988.

Aristotle. The Politics, translated by T. A Sinclair, revised and re-presented by Trevor J. Saunders.London: Penguin Books, 1992.

Azad, Maulana Abul Kalam. Tarjuman a1-Qur'in. New Delhi: Sahtiah Akademi, 1964.

Azmi, M. M. On Schacht's Origins ofMuhammadan Jurisprudence. Riyadh: King Saud University, 1985.

Badr, Gamâl Mours!. 'Islamic Law: Hs Relation to Other Legal Systems.' American Jou111al ofComparative Law26 (1978): 187-198.

Baroodi, G. M. Crime andPunishment Under Islamic Law[trans. ofManir al"SabJl, by Sheikh Ibriil.JlmIbn Mul;.ammad Ibn SalJm Ibn DüyinJ London, 1979. 2nd ed.

Birnie, Arthur. The History andEthics ofInterest. Glasgow: William Hodge & Company Limited, 1952.

Born, A Van den, and L. Hartman, "Loans", Encyclopedie Dictionary offhe Bible, edited by L. Hartman.N.Y: McGraw-Hill, 1963.

Buckley, S. L "A theological examination of the religious teachings on 'usury' within the threemonotheistic traditions of Judaism, Christianity and Islam, and its relevance for the world today."

Ph.D. Dissertation, Aberdeen University, 1996.

çagatay, N. 'Ribâ and Interest Concept and Banking in the Ottoman Empire.' Studia Islamica. 32 (1970).

Calder, N. Studies in Early Muslim Jurisprudence. Oxford: Clarendon Press, 1993.

Cardahi, C. 'Le Pret a Interet et l'Usure au Regard des Legislations Antiques de la MoraleCatholique Du Droit Moderne et de la Loi Islamique.' Revuelntemationale de Droit Compare.

VII (July - Sept 1955).

Chapra, Muhammad Umar. Islam and the Economie Challenge. Leicester: The Islamic Foundation, 1992.__. Towards a Just Monetary System. Leicester: The Islamic Foundation, 1992.__. The Economie System ofIslam. London: The Islamic Cultural Center, 1970.__. 'The Nature ofRibâ in the Qur'ân, I:Iadith and Fiqh.' In An Introduction to Islamic Finance.

edited by Sheikh Ghazali Sheikh Abod, Syed Omer Syed Agil, and Aidit Hj. Ghazali. KualaLumpur: Quill Publishers, 1992.

Cobhan, Brewer E. Dictionmy ofPhrase & Fable. 1898.

Corbin, AL. Corbin on Contracts. SLPaul: West Publishing Co., 1960.

Coulson, Noel 1. A History ofIslamic Law. Edinburgh: Edinburgh University Press, 1964.. Commercial Law in the GulfStates. London: Graham & Trotman, 1984.

87

Council of Islamic Ideology. Report on the Elimination ofInterest trom the Economy Islamabad:Ministry of Finance, Govemment of Pakistan, June 1980.

__. Report offhe Panel ofEconomists andBankers. Islamabad: Ministry of Finance, Govt. of Pakistan,n.d.

Draz, Shaikh. 'L'Usure en Droit Musulman', in Travaux de la Semaine, Intel11ationale de DroitMusulman. Sirey, France, 1953.

Driver, G. R. and I.e. Miles (ed.), The Babylonian Laws, Oxford: Clarendon Press, 1955.

Enazy, AH. The Islamic Development Bank: Its Origins, Purposes, Functions and Operations, 1975-1983.M.A Thesis, McGill University, 1987.

Encyclopedia ofIslam, new (2nd) edition. Leiden: EJ. Brill, 1960--.

Encyclopaedia Judaica - CD ROM Edition, Judaica Multimedia (Israel) Ud.

Faruqi, Harith Sulayman. Faruqi 's Law Diction81Y - Arabie English. Tripoli: Libyan PublishingHouse, 1962.

Fyzee, AAA 'Origin of Muslim Law.' Outfines ofMuiJammadan Law. Delhi: Oxford University Press,1977.

Gauhar, Altaf. Translations From TiJe Quran.. Lahore: Sang-e-Meel Publications, 1989.

Gerber, H. 'The Muslim Law ofPartnership in Ottoman Records.' Studia Islamica, LIlI: Ill.

Gibb and Krarners (eds.). ShorterEncyclopaedia ofIslam. Leiden: E.J. Brill, 1953.

Gleave & Kermeli (eds.), IslamicLaw: Theory andPractice; London; Nêw York: I. B. Tauris, 1997.

Goldziher, Ignaz. Introduction to Islamic Theology andLaw. Princeton: Princeton University Press, 1981.__.Die Zahiriten Ihr Lemsystem Und Ihre Geschiehte, Beitraq Zur Geschichte Der

Muhammedaneschen Theologie. Leipzig: Otto Schulze, 1884.

Hallaq, Wael B. A History ofIslamic Legal Theories - An Introduction to Sunni u~ülal-fiqh. Cambridge:Camblidge University Press,1997.

__. Law andLegal Theory in Classical andMedieval Islam. Hampshire: Variorum, 1995.__. Authority, Continuity and Change in IsJamic Law. Cambridge: Cambridge University Press, 2001.__. 'Was the Gate of IjtihidClosed?' Intel11ational JoumaJ ofMiddle East Studies, 16, 1 (1984): 3-41.

Hamid, M. 'Islamic Law ofContract or Contracts.' JournalofIslamic and Comparative Law.3 (1969): 1-11__. 'Mutual Assent in the Formation of Contracts in Islamic Law', JOUl11al ofIslamic and Comparative

Law. 7 (1977): 41-53.

Hamlin, K.L.Peters. 'The Impact ofIslamic Revivalism on Contract and Usury Law in Iran, Saudi Arabiaand Egypt.' Texas Intemational Law JOUl11al, 22 (1987): 351-381.

Hassan, Abdullah Alwi Haji. Sales and Contracts in Early Islamic Commercial Law. Islamabad: IslamicResearch Institute, International Islamic University, 1994.

Heichelheim, Fritz. An Ancient Economie History, translated by Joyce Stevens. Leiden: Sijthoff, 1958.

Holy Bible. Autholized King James Version. Grand Rapids, Mich.: Zondervan Publishing House, 1962.

88

Hughes, T. P. A Dictionary ofIslam. London: n.p., 1885. Reprinted Lahore: Premier Book House, 1989.

Humphreys, R.S. 'Islamic Law and Islamic Society.' Islamie History: A Framework for Inquiry. London;New York: I.B. Tauris, 1995. ch. 9.

Ibrahim, Mahmood. 'Social and Economie Conditions in Pre-Islamie Mecca' International Journal ofMiddle Eastel7l Studies 14. (Cambridge, 1982): 343-358.

Islahi, Abdul Azim. Economie Concept ofIbn TaymiyaiJ. London: The Islamic Foundation, 1988.

Jennings, R.C. 'Loans and Credit in early 1i h eentury Ottoman Judicial Records.' Journal oftheEconomie and Social History ofthe Orient, XVI (1973): 168-216.

Johnston, Herbert L. "Mediaeval Teachings on the Morality ofUsury." Ph.D. Dissertation, University ofToronto, 1938.

Kahf, Monzer. A Contribution to the Studyofthe Economies of/siam. Utah: University of Utah, S. L. c.,July 1973.

Kamali, M. H. Principles ofIslamie Jwisprudence, 2nd edition. Cambridge: Islamie Texts Society, 1991.

Khadduri, M. Islamic Jurisprudence: Shiifi '1 's Risila. Baltimore: John Hopkins Press, 1961.

Khan, Muhammad Akram. Economic Teachings ofPropiJet MuiJammad - A Select AntiJology oflfaditiJLiteratw'e on Economies. Islamabad: International Institute oflslamic Economies and InstituteofPolicy Studies, 1989.

__. 'Time Value of Money.' In An Introduction to Islamie Finance, edited by Sheikh Ghazali SheikhAbod, Syed Omer Syed Agil, and Aidit Hj. Ghazali. Kuala Lumpur: Quill Publishers, 1992.

Khan, Mir Sadat. 'Muhammedan Laws against Usury and How They are Evaded.' Journal ofComparativeLegislation, 2 (1920?,1929): 233-244.

Kuran, Timur, "The Economie System in Contemporary Islamic Thought: Interpretation andAssessment" Intel7lational Journal ofMiddle Eastel7l Society, vol. 18 (1986): 135-164.

Kister, M.J. 'Sorne Reports Concerning Mecca l'rom Jahiliyya to Islam.' Journal oftiJe Economie andSocial Historyofthe Orient, XV (1972): 61-91.

__. Studies in iihiliyya andEarly Islam. London, 1980.

Knight, Frank. Risk, Uncertainty andProfit. New York: Houghton Mifilin, 1921.

Lane, Edward William. An Arabie-English Lexieon. London; Edinburgh: Williams & Norgate, 1893.

Legal Academy of the Organization of the Islamic Conference. Proceedings of conference, FinancialMarkets, in Jedda, Saudi Arabia. March, 1990.

Liebesny, Herbert. TiJe Law ofthe Near & Middle East: Readings, Cases & Materials. Albany: StateUniversity ofNew York Press, 1975.

MaHat, Chibli. 'The Dehate on Riba and Interest in Twentieth Century Jurisprudence', Islamic Law andFinance. SOAS, London, 1988.

__. 'Tantawl on Banking Operations in Egypt.' In Islamic Legal Interpretation: Mu/lis and tiJârFatawis, edited by M. Khalid Masud, Brinkley Messick and David Powers. Cambridge, MA:Harvard University Press, 1996.

89

Mannan, M.A. 'Consumption Loan in Islam.' Islamic Review(London) 58:3 (March 1970): 19-22.__. "Islam and trends in Modem Banking: Theory and Practice of Interest Free Banking." Islamic

Review(London) 57:11 (January 1969): 28-33.

Mapara, Shahina. "A Critical Examination of S.N.H. Naqvi's Islamic Economies." M.A. Thesis, McGillUniversity, 1999.

Margoliouth, D. S. The Eady Development ofMuhammedanism. New York: Scribner, 1914.

Masud, Messick & Powers. Islamie Legal Interpretation: Muftis and Their Fatawiis. Cambridge, Mass:Harvard University Press, 1996.

Mawdüdi, Syed Abül A'lii. Süd Lahore: Islamic Publications (Private) Ltd., 1989.__. Economie System ofIslam. Ed. Khurshid Ahmad, Tr. Riaz Husain. Lahore: Islamic Publications,

1997.__. Economie Problems ofMan and Their Islamic Solution. Lahore: Islamic Publications, 1972.__. al-riba. Damascus: dar al-fikr, n.d.__. Taihlm al-Qur'iin. Lahore: Pan Islamic Publishers, 1978.

McLaughin, 'The Teaching of the Cannonists on Usury.' Medieval Studies. 1(1939), III (1940).

Mendenhall, George. Law and Covenant in Israel and the Ancient Near East. Pittsburgh: BiblicalColloquium, 1955.

Mills, P. S. "Should Interest Exist? Non-Usurious Finance in Economie Thought, Theory and Practice."Ph.D. Dissertation, Cambridge, 1994.

Mourad, MaslÙ10ur Farouk. "Financial and Economie Policy in Islam: A Platform for Moral Capitalism."Ph.D. Dissertation, University ofCalifornia, Los Angeles, 1999.

Muirhead, James. Historical Introduction to the Private Law ofRome. Third ed. revised and edited byAlexander Grant. London: A & C Black, 1916.

Muslehuddin, Muhammad. Banking and Islamie Law. Karachi: Islamic Research Academy, 1974.

Nadifi, Nadia. "The Islamic Finance Alternative." M.Sc. Thesis, George Washington University, 2000.

Naqshbandi, Qari Muhammad Amin. Islamic Economies. Lahore: Iqra Books, n.d.

Naqvi, S. N. H. Ethics andEconomies: An Islamie Synthesis. Islamic Economie Series. Leicester: IslamicFoundation, 1981.

Nasr, Seyyed Vali Reza. "Islamic Economies: Novel Perspectives." Middle Eastem Studies, Vol. 25, No. 4(1989): 516-530.

__. "Whither Islamic Economies?" The Islamic Quarterly, Vol. 30. No. 4 (1986): 211-220.

Nyazee, Irnran Ahsan Khan. Theories ofIslamic Law. Islamabad: Islamic Research Institute Press, 1994.__.The Concept ofRibii and Islamie Banking. Islamabad: Niazi Publishing House, 1995.

Nelson, Benjamin N. The Idea ofUsUJy from Tribal Brotherhood to UniversalOtherhood Chicago:University of Chicago Press, 1969.

Noonan, John T. The Scholastic Analysis ofUsury. Cambridge, MA: Harvard University Press, 1957.

Noorzoy, M. Siddiq. "Islamic Laws on Riba (Interest) and Their Economie Implications." Intemational

90

Joumal ofMiddle Eastem Society, Vol. 14(1982): 3-17.

Organization of the Is1amic Conference. Islamie Fiqh AcademyResolutions andRecommendations.Jedda: Organization of the Is1amic Conference, 1989.

Posner, Richard A. The Economie Analysis ot'Law. Boston: Little, Brown & Co., 1992.

Powers, David S. Studies in Qur'in andlfadit1J. Berkley: University ofCalifomia Press, 1986.

Qureshi, Anwar Iqbal. Islam and the TheoryofInterest. Lahore: Is1amic Publications, 1972.

Rallim, Abdm Sir. Mohammedan Jurisprudence. Madras: n.p., 1905. Reprinted LallOre: P.L.D. Publishers,n.d.

Rahman, Faz1ur. 'Riba and Interest.' Islamie Studies3 (Mardl 1964): 1-43.__. 'A Study ofCommercia1 Interest in Islam.' Islamic Thought. 5:4(Ju1y-Oct. 1958): 24-46.__. 'Economic Princip1es ofIs1am.' Islamic Studies 8 (1969): 1-8. '

Rasyid, Amhar. "Sorne Qur'anic 1ega1 texts in the context of Faz1ur Rahman's hermeneutica1 method."M.A. Thesis, McGill University, 1994.

Ray, Nicholas. AJ'ab Islamie Banking and the Renewal ofIslanu'c Law. London: Grallam & Trotman,1995.

Ryan, Franklin Winton. "Usury and Usury Laws." Ph.D. Dissertation, Harvard University, 1925.

Rayner, S.E. 'Riba, Gharar and Maysir.' The Theory ofContracts in Islamie Law. London: Grallam &Trotman, 1991, pp.266-304.

Roberts, R. The Social Laws ofthe Qur'in. London: Curzon Press, 1980.

Rodinson, Maxim. Islam and Capitalism. New York: Pantheon Books, 1973.

Saadallah, Ridha. 'Concept ofTime in Is1amic Economics.' Islamie Economie Studies 2 (1994): 81-102.

Al-Sadr, Muhammad Baqir. Iqtisiiduna: Our Economies. Tehran: World Organization for Is1arnicServices, 1982.

Saeed, Abdullall, Islamie Banldng andInterest: A Studyofthe Prohibition ofRibiiand its ContemporaryInterpretation. Leiden: EJ. Brill, 1996.

Saleh, Nabil. Unlawful Gain andLegitimate Profit in Islamic Law, 20d ed. London: Graham & Trotman,1992.

Sattar, S.A. 'Interest Free Banking.' Criterion 9:6 (June 1974): 15-26.

Sa'üd, M~ammadAbu a1-. 'Islamic view ofriba.' Islamie Review. 45:2 (February 1957): 9-16.

Schacht, Joseph. Introduction ta Islamic Law. Oxford: Clarendon Press, 1964.__. The Origins ofMohammedan Jurisprudence. Oxford: Clarendon Press, 1950.__. 'The Law.' Unity and Variety in Muslim Civi/ization. Ed. Gustave E. Von Grunebaum. Chicago,

1955, pp. 65-86.__. 'Pre-Islamic Background and Early Development of Jurisprudence' Law in the Middle East,

91

Origin and Development ofIslamie Law. Eds. Majid Khadduri and Herbert J. Liebesney. vol. I.Washington, 1955, pp. 28-56.

__.'Foreign Elements in Ancient Islamic Law.' Joumal ofComparative and Intemational Law, 32(1950): 9-17.

__. 'Riba.' Encyclopaedia ofIslam. Vol. III, p.1l48.

Shafi, Maulana Mufti Muhammad, and Mufti Muhammad TaqiUsmani. Trans. Anwar Ahmed Meenai,The Issue ofInterest. Karachi: Darul Ishat, 1997.

Siddiqi, M.N. Muslim Economic Thinking: A Survey ofContemporary Literature. Leicester: IslamicFoundation, 1981. 1-45.

__. 'The Economicsoflslam.' Is1amic TllOUght 14:3 (1971): 22-33.__. 'A Model ofInterest Free Banking.' Criterion 6:4 (July-August 1961): 19-33.__. The Economic Enterprise in Islam. Lahore: Islamic Publications, 1972.__. Banidng Without Interest. Leicester: The Islarnic Foundation, 1983.__. Issues in Islamic Banldng: Selected Papers. Leicester: The Islamic Foundation, 1983.__. Partnership and Profit ShaJing in Islamic Law. Leicester: The Islamic Foundation, 1985.

Syahnan, Mhd. "A Study of Sayyid Qutb's Qur' ânic Exegesis in Earlier and Later Editions of his Fi Z;îliilal-Qur'an with Specific Reference to Selected Themes." M.A. Thesis, McGill University, 1997.

al-Thanawi, Muhammad. A Dictionary ofthe Techniea/ Terms Used in the Sciences ofthe Musa/mans.Tr. A. Sprenger. Calcutta: W.N. Lees Press, 1862.

Tuma, E.H. 'Early Arab Economic Policies.' Islamie Studies, 4 (1) (Karachi, March 1965): 1-25.

Udovitch, Abraham L. Partnership andProfit in Medieval Islam. Princeton: Princeton University Press,1970.

Usmani, Taqi (Justice). Introduction to Islamic Finance. Karachi: Idaratul Ma'rif, 1998.

Uzair, Mohammed. An Outline ofInterest-less Banldng. Karachi: Raihan Publications, 1955.

Vesey-FitzGerald, S. G. Muhammadan Law: An Abridgement According to its Various Schools.Aalen: Scientia Verlag, 1979.0xford,1931.

__.'The Alleged Debt oflslamic to Roman Law,' Law QuarterlyReview, 67 (1951): 81-102.

Vogel, Frank E. and Samuel L. Hays, III. Islamic Law and Finance: Religion, Risk andRetum. TheHague: Kluwer International, 1998.

Weber, Max. On Lawin Economy and Society. Translated by Edward Shils and Max Rheinstein. Editedby Max Rheinstein. New York: Clarion Book, 1954.

Wegner, J.R. 'Islamic and Talmudic Jurisprudence: The Roots oflslamicLaw and their TalmudicCounterparts.' Americàn Joumal ofLegalHistory, 26 (1982): 25-71.

Wehr, Hans. A Dietionary ofModem Written Arabie. 4th ed. Ithaca, NY: Spoken Language ServicesInc. 1994.

Wolf, E.R. 'The Social Organization ofMecca and the Origins oflslam,' Southwestem JoumaJ ofAnthropology, 7 (Albuquerque, 1951): 329-356.

Ziadeh, FJ. 'al-Muwatta a~ a Source for the Social and Economie History of the l:Iijaz.' Islamic Studies,18 (Islamabad, 1979): 299-309.

92