ABSTRACT
Ribā normally refers to unjust and exploitative gains made in trade or business. Technically, ribā is an addition in the principal amount, paid by the borrower to the lender, that is stipulated in a loan transaction. Anything chargeable besides the principle amount as a contractual obligation falls into the category of ribā. This chapter starts with a detailed elucidation of the prohibition of ribā in the light of the Qur’an and in the Prophetic sunnah. It defines the notion of usury (ribā) and its kinds in terms of ribā al-duyūn (interest earned on lending money to another party) and ribā al-buyū’ (a sale transaction in which a commodity is exchanged for an unequal amount of the same commodity and supply is postponed). At the end, a detailed account on some of the significant concepts like ribā al-faḍl (surplus interest) and ribā al-nasī’a (interest charged on loans) is also given to obtain a holistic portrayal of ribā in Islam.
