Introduction to Islamic Banking
An overview of the basic principles
The Quran mentions in Sura An-Nisa (4:161):
That they took riba (usury), though they were forbidden and that they devoured men’s substance wrongfully – We have prepared for those among men who reject faith a grievous punishment.
There are mentions in the Hadith as well about the prohibition of Riba. Abu Hurayrah (ra) narrated that the Prophet (saw) said:
“Allah would not allow four persons to enter paradise or to taste its blessings: he who drinks wine, he who takes riba, he who usurps an orphan’s property without right and he who is undutiful to his parents.”
Quran and Hadith
The Quran further mentions:
“That which ye given in Riba in order that it may increase on (other) people's property hath no
increase with Allah; but that which ye give in charity; seeking Allah's countenance, hath increase manifold” (30:39).
“Those who devour Riba will not stand except as stands one whom the evil one by his touch hath driven to madness. That is because they say: ‘Trade is like Riba'. But Allah hath permitted trade and forbidden Riba. Those who after receiving direction from their Lord, desist, shall be pardoned for the past; their case is for Allah (to judge). But those who repeat (the offence) are companions of the fire; they will abide therein (forever)” (2:275).
