gateway to islamic finance interview - Institute of Islamic Banking ...
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NEWHORIZON July–September 2008

A new take on riba

Dr Azeemuddin Subhani spent nearly three decades working as a financial advisor in the Saudi

oil ministry. Though he worked in a conventional financial environment, he nevertheless

harboured a passion for Islamic finance and law. When he retired in 1999, he took the

opportunity to study it at McGill University in Canada. He finished a PhD in Islamic Law and

Finance in April 2007. He has since presented his thesis, in which he provides a new definition

of the concept of riba, at Harvard Law School in the US, where it is currently being edited for

publication. Dr Subhani has been publicising it for a couple of months now, in which time Sheikh

Nizam Yaqubi, a prominent Shari’ah scholar, has offered to translate it into Arabic and distribute

it to libraries across the Arabic world. Others have offered to translate it into Turkish and Urdu.

Here, Dr Subhani explains to NewHorizon what he thinks the true meaning of riba is all about.

Dr Azeemuddin Subhani

NewHorizon: What is the background of

your thesis?

Dr Subhani: If you survey Islamic literature,

you find that the whole question of the

prohibition of riba has been dealt with at a

very cursory level. None of the scholars

have really gone into the depths of the issue

as to what the real meaning of ‘riba’ is, and

why there is such a strict idea of the

prohibition of riba in the Quran. This sin is

treated as the greatest of all sins, and the

Quran lays down very graphic punishment

for any human indulgence in riba.

But nobody gives us an exact explanation as

to why the financial or economic act of riba

carries such characterisation as the greatest

of sins. The Quran threatens humankind

with eternal hellfire for those who indulge

in any act of riba. So my question became,

why? What is at stake here? Is riba just a

financial and economic sin?

There are more serious economic crimes,

but they do not attract such punishment in

the Quran. If riba, or interest, is usurpation

of wealth from the poor to the wealthy, at

least there is consent from both parties.

You can have a usurpation of the same

wealth from poor to rich by fraud or

deception, which is theft. But theft does not

carry such serious punishment in the Quran.

You can do even worse – you can rob by

force, or by murder – but this most grievous

of impacts on a fellow human being does

not attract such serious punishment as riba

does in the Quran.

The punishment is clearly out of line with the

gravity of the perceived sin – perceived as it is

as an economic or financial sin. This plainly

goes to show, at least to me, that the act of

riba is not solely an economic paradigm.

It does not belong in that category.

So what is your answer for the discrepancy?

I asked myself, what is the intrinsic

characteristic in the process of riba? For this I

used a linguistic analysis of the Quran which

has not been attempted before in this area.

My conclusion is that, if you analyse the act

of interest taking and some other verbal

applications of riba in the Quran, you will

find that the Arabic term ‘riba’ basically

means growth from a process of self

generation. ‘Riba’ is one agent acting on itself

to produce growth. Money begetting money,

as Aristotle might say, is the obvious

example. Without the intervention of any

other agent, money can just keep on growing.

You just put it in a bank account, and even if


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