Usury

Surah 2 (Al-Baqarah/The Cow): 275

Those who swallow usury will not rise, except as someone driven mad by Satan’s touch.

That is because they say ‘Commerce is like usury.’

But God has permitted commerce and has forbidden usury.

Whoever, on receiving advice from his Lord, refrains, may keep his past earnings, and his case rests with God.

But whoever resumes—these are the dwellers of the Fire, wherein they will abide forever.

 

‘Riba’, literally ‘growth’, is in this context invariably translated as meaning usury. It is condemned in the Qur’an at {2.275} above, and also at:

{3.130}: ‘Devour not usury, doubling and multiplying,’

and

{4.161}, in the context of its practice by the Jews.

 

It is customary to explain this prohibition as a response to the charging of excessive and exploitative interest, but whilst this pejorative meaning of ‘usury’ is suggested by {3.130}, it is evident that {2.275} had been composed to rebut an argument that ‘growth’ through the charging of interest upon loans was a legitimate practice by comparing it with trading goods: ‘They say commerce is like usury’. This argument was rebutted with the drawing of a clear distinction between loans and trade – ‘God has permitted commerce, and forbidden usury’, with no indication that ethical commercial lending was a possibility.

 

{30.39}, probably the earliest reference to usury in the Qur’an and the only such reference from a surah traditionally regarded as Meccan, noticeably does not present usury as a sin, but only as an activity that, in contrast to almsgiving, will not bring rewards on the Last Day:

{30.39} That which you give in usury that it might increase through other people’s wealth, does not increase with God. But that which you give in alms desiring the Face of God – it is they who receive a manifold increase.

Thus, when the verses seen in their likely chronological order they show an increasing intolerance of interest loans, similar as seen with alcohol and gambling, see 〈70.〉