The Supreme Court of Pakistan, in determining the applications and implications of the term “Riba” asked for assistance of religious scholars and other interested people of the country. For this purpose, answers to ten questions were sought. The first among these questions was:
The Holy Qur’an has prohibited ‘Riba. What is meant by this term? What is its true definition and connotation in the light of the Holy Qur’an and Sunnah of the Prophet (PBUH)?
My Reply to this question follows:
I would like to clarify at the outset that the Qur’an has not used the word “Riba” as a term. On the contrary, the word has been used in the Qur’an in its simple literal meaning. This is a very important fact and has its implications in determining the meaning of the word: ‘Riba.
Had the word been used as a term in the Qur’an, it would have been necessary that the meaning be determined on the basis only of its definition given by the Qur’an. On the other hand, if ‘Riba is a common Arabic word, and is used in the Qur’an in its common literal meanings and connotations, then the determination process would not depend on the Qur’an but it would then actually follow the same course as we adopt in determining the meanings and connotations of any given word of any given language.
Thus, the requirement of the learned court that: “What is its true definition and connotation in the light of the Holy Qur’an and Sunnah of the Prophet (PBUH)?” could only have been met if either the word ‘Riba was used in the Qur’an, not in its common literal meaning but as a term specific to the Qur’an and the Sunnah or if the Qur’an and the Sunnah included chapters of definition of all commonly used Arabic words. When neither is the case, we shall then have to base our findings primarily on the dependable dictionaries and other such sources of the Arabic language.
The Arabic verb: “Raba”, “Yarbu” has generally been explained in most of the Arabic dictionaries as:
زاد و غا
to increase and to grow [to augment].
The noun, “Riba” or “Al-Riba”, generally used in the Qur’an, has been defined by the most authentic and well known Arabic dictionary “Aqrab al-Mawarid” as:
العينة … و – الفضل
[It is the same thing as the transaction of] al-`eenah … and increase.
It is quite clear from the above statement that as a noun, the word “Riba” or “Al-Riba” is used in two meanings: 1- increase and 2- something called “al-eenah“. “Aqrab al-Mawarid” itself under the word “عين” has defined “بيع العينة” or the ‘Transaction of al-`eenah‘ as:
That a man asks another for a loan, but the lender is not interested in extending that loan as he shall not be able to get any extra amount on that loan [because that is prohibited]. So he says: I sell you this cloth for twelve dirhams [on credit] for a fixed period of time. While its actual price was ten dirhams. Thus he gains two dirhams for that fixed period of time.
The meaning and connotation of the word “Riba” or “Al-Riba” have remained unchanged over time. The meaning of this word as given in some modern day Arabic dictionaries is as follows:
According to “Al-Raayed”:
Riba means: 1- the extra [i.e. the additional amount] or the increase; 2- gain on a loan.
According to “Laroos”:
Riba means: a) the extra [i.e. the additional amount]: the gain or the profit that a gainer gets on his loaned amount; b) (in financial and economic language) the amount that a borrower pays over and above the amount that he had borrowed following specified conditions [regarding rate and time].
The same kind of explanation has also been given in “Mo`jam al-Waseet”.
In the light of the above explanation, we can say that the word “Riba” has two meanings: 1) any increase on an amount; and 2) a gain on a loan, at a predetermined rate, which the lender receives from the borrower for allowing the borrower to use his financial assets for a time period (on the basis of the meaning given in “Aqrab al-Mawarid”, “Laroos” and “Mo`jam al-Waseet”).
Now, the obvious question that comes to mind is: In which of the two meanings has the Qur’an used the word “Riba”. A close look at the verses in which the word “Riba” has been used by the Qur’an provides us with adequate basis to say that it is actually in the latter of two meanings given above that the Qur’an has used this word. Some of the reasons that clearly guide us in this matter are:
- Had the Qur’an used the word “Riba” in the first meaning, it would also have applied to that “increase” which is a result of all kinds of trading and business activities. However, it is obvious from the words of the Qur’an that such “increase” has not been included in the implications of the word “Riba”, as is evidenced from the words: “They say: Trading is but like Riba” (Al-Baqarah 2: 275) and: “God has allowed trading and has forbidden Riba” (Al-Baqarah 2: 275). In both these sentences, it is clear that the “increase” which is the result of a trading or a business activity is not included in the word “Riba”.
- Then again the Qur’an says: “… then you shall get your principal amounts back. Neither should you wrong nor should you be wronged.” (Al-Baqarah 2: 279). This verse removes all doubts that might have existed in one’s mind regarding the fact that the “Riba” referred to in these verses is what has been given above as the second meaning.
- Then again, the Qur’an says: “If he [that is the debtor] is in some difficulty [and is therefore not in a position to return the principal amount immediately] grant him time till it becomes easier for him [to return the principal amount]” (Al-Baqarah 2: 280).
It should be quite clear from the details given above that the word “Riba” is used in the Qur’an in the same meaning in which we generally use the word “interest” (as in ‘interest on loans’) in the English language and the word “sood”, in the Urdu language. Thus, the word “Riba” is actually used for: “a gain on a loan or an investment, at a predetermined rate, which the lender demands from the borrower for allowing the borrower to use his financial assets for a given period of time”.