#6 Usurious Gain (Riba): Usurious Gain in Sales of Foodstuffs, Gold and Silver
Introduction
Usurious gain or interest (Riba) is one of the main prohibitions in Islamic transactions. This article illustrates how riba applies to trading food, gold, and silver. It examines the rulings that make the transactions valid and acceptable under the Shariah law. The purpose is to help ensure that trade in Islam is fair, clear, and Shariah-compliant.
Riba
The lexical definition of Riba is الزيادة, Az-ziyadah, or increment.
In Shariah Law, there are two types of riba. The first is usurious gain in selling, which is an “agreement for a specific recompense whose equivalence to the merchandise is unknown according to the standards of the Law at the time of the transaction, or in which the exchange of the two properties transacted is delayed, or one of them is delayed.”
Below is the Arabic definition of riba, according to quotations in the paragraph above.
“عقد على عوض مخصوص غير معلوم التماثل في معيار الشرع حالة العقد أو ما تأخير في بدلين أو أحدهما”
The second type concerns loans, and consists of any loan by which the lender obtains some benefit.
The basis for its unlawfulness, prior to scholarly consensus is in the Qur’anic verses below:
- “Allah permits trade but forbids usurious gain:” (2:275)
- “Fear Allah and relinquish what remains of usury, if you are believers” (2: 278)
According to hadiths that has been narrated by Muslim,
“The Messenger of Allah (peace and blessings upon him) cursed whoever eats of usurious gain, feeds another with it, writes an agreement involving it, or acts as a witness to it.”
Another hadith, in al-Mustadrak (by Hakim), relates that the Prophet (peace and blessings upon him) said,
“Usurious gain is of seventy kinds, the least of which is as bad as a man marrying his mother.”
| Notes from Ustaz Anwar | English Translation | Arabic Text |
| There are six ribawi items that are sold by weight and measure – gold, silver, wheat, barley, salt, and dates. | Gain is not unlawful except in certain exchanges involving foodstuffs, gold, and silver.
(As for usurious gain or interest from loans, it is unlawful for any type of property whatever) |
لا يحرمُ الرِّبا إلا في المطعوماتِ، والذهبِ والفضَّةِ |
| This is only applicable to the Shafi’ee school of thought, where something that can be eaten has riba in it. | The determining factor in the prohibition of usurious gain in foodstuffs is their being edible | والعلَّةُ في تحريمِ المطعوماتِ الطُّعمُ |
| Why are gold and silver considered ribawi items? They are measurements of value. Also known as dinar and dirham during the time of the Prophet s.a.w. | and in gold and silver, their being the value of things. | وفي تحريمِ الذهب والفضة كونُهُما قيمَ الأشياء |
| Wheat and rice are not considered in the same category, but Basmati and Jasmine are of the same category, as both are rice.
However, they are of different types, so there is still riba when you exchange 1kg of Basmati rice with 2kg of Jasmine rice. |
When a foodstuff is sold for a foodstuff of the same kind, such as wheat exchanged for wheat (or the gold is traded for gold). Three conditions are obligatory: | فإذا بيعَ مطعومٌ بمطعومٍ منْ جنسهِ، كَبُرٍّ بِبُرٍّ اشتُرِطَ ثلاثةُ أمورٍ: |
| There has to be exact measurement. For example, exchanging 100g of gold with 100g gold. If the amount is different, there will be riba al-fadhl, which is interest of excess from unequal exchange of like commodities. | (a) exact equivalence in amount
(which must be made certain of, this stipulation precluding exchanges of foodstuffs, gold, or silver in which the amounts are not known, for such sales are not valid even if the two quantities transacted subsequently turn out to be equal, because of the ignorance of their equivalence at the time of the transaction, since ignorance of it is the same as actual nonequivalence) |
المماثلةُ في القدْرِ |
| The exchange should occur during the sale transaction, where the spoken offer and acceptance has to also be conducted at that time. Else, there will be riba al-yad, where a sale transaction that involves barter exchange of the same commodity in unequal amounts and postponed delivery by either or both parties. | (b) that the properties transacted be in the respective possession of buyer and seller before they part company | والتقابضُ قبلَ التفرُّقِ |
| The sale transaction cannot be delayed, for instance when the spoken offer and acceptance are conducted but the item is not present.
“Use first, pay later” is invalid, there will be riba an-nasa’ – an increase due to deferment one of the countervalues in an exchange between ribawi items of the same type. |
(c) and immediacy (such that the agreement does not mention any delay in the exchange, even if brief) | والحُلولُ |
| If the items are of different types then only two of the conditions above are applied. | When foodstuffs are sold for foodstuffs of a different kind, such as wheat for barely (or when gold is sold for silver), only two conditions are obligatory: | وإنْ كانَ منْ غيرِ جنسهِ، كَبُرٍّ بشعيرٍ اشتُرِطَ شرطانِ |
| For example, 2kg of rice can be exchanged with 10kg of dates, but have to satisfy the two requirements above. | (a) that the exchange be immediate;
(b) and that the properties exchanged be in the respective possession of buyer and seller before they part company. |
الحُلولُ، والتقابضُ قبلَ التفرُّقِ |
| The commodities can differ in their measurements, like in the example mentioned above. | If these two conditions are met, the two commodities exchanged may differ in amount. | وجاز التفاضلُ |
Conclusion
The rules to trade food, gold, and silver in the Shariah principles are important to understand as they ensure fairness in transactions. By doing so, trade becomes clearer, and elements that are prohibited in the Shariah law are avoided to align with the principles of fairness and justice among parties in a transaction.
Written by Maryam Binte Aziz for notes on Umdatus Salik episode 18 episode 185 – Usurious Gain (Riba): Usurious Gain in Sales of Foodstuffs, Gold and Silver.
