Gradual prohibition of riba (usury) in Madeenah
Fatwa No: 322933

Question

When the verses forbidding interest were revealed, how did the Prophet, sallallaahu 'alayhi wa sallam, implement the order in the financial system of the State of Medina? What sources are available for reference in this important matter?

Answer

All perfect praise be to Allaah, The Lord of the worlds. I testify that there is none worthy of worship except Allaah and that Muhammad  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) is His slave and Messenger.

Your question has more to do with research than with fataawa. Indeed, Islamweb issues fataawa to the questioners who seek a religious ruling and is not concerned about writing research for students.

However, for the purpose of general benefit, we draw your attention that the verses about forbidding interest were revealed gradually and that its prohibition was the last to be revealed of the Quran. Ibn Abbaas  may  Allaah  be  pleased  with  them said, “The last verse that was revealed to the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) was the verse about interest. [al-Bukhari] But this prohibition was gradual in order to prepare the people for it.

Shaykh Wahbah az-Zuhayli said in his book Al-Fiqh Al-Islaami wa Adillatuhu:

I hereby clarify the gradual stages of the legislation of prohibiting interest in the Quran, and I mention the ahaadeeth that are absolutely confirmed authentic beyond any doubt and that clarify the meaning of interest... Gradualness in the legislation: this is among the characteristics and the foundations of clarifying the Islamic rulings; for example, wine [and all kinds of alcoholic drinks] was not forbidden at once, as is known … also, the prohibition of riba/interest passed by four stages:

1- Clarifying that what the Jews were doing, which is consuming interest, was evil, and rebuking them for this act as in the saying of Allaah (which means): {[They are] avid listeners to falsehood, devourers of [what is] unlawful.} [Quran 5:42] Allaah also says (what means): {For wrongdoing on the part of the Jews, We made unlawful for them [certain] good foods which had been lawful to them, and for their averting from the way of Allaah many [people], and [for] their taking of usury while they had been forbidden from it, and their consuming of the people's wealth unjustly. And we have prepared for the disbelievers among them a painful punishment.} [Quran 4:160-161]

2- Making a distinction between interest and zakah in the verse: {And whatever you give for interest to increase within the wealth of people will not increase with Allaah. But what you give in zakah, desiring the countenance of Allaah - those are the multipliers.} [Quran: 30:39]

3- Denouncing what the polytheist Arabs were doing in the Jaahiliyyah (Pre-Islamic Era) and prohibiting the believers from doing the same thing like them; Allaah says (what means): {O you who have believed, do not consume interest, doubled and multiplied.} [Quran 3:130] The prohibition is not restricted to when it is doubled; but this is just a statement for clarifying the fact [which is what was happening] and clarifying the obscenity of the prevailing well-known situation among the Arabs when one of them lends money to another to return it after a given period, and when the appointed period for returning the debt comes and the indebted is unable to repay the loan, then the creditor says to the debtor: well, either you repay or you pay interest, so he extends the period of loan for him in return for an increase in interest. This is exactly what the current banks are doing; the interest is for example 7% or 9%, and when the debtor is unable to repay, the bank doubles the interest in the second year and third year and so on, until the interest is almost equal to the original capital money. This is a fact which those who are in favor of this interest do not pay attention to, and they argue that the amount of interest is slight and say that it is lawful. Rather, this interest is worse than the usury of Jaahiliyyah.

4- Categorically prohibiting usury and describing those who consume it as being subjected to a war from Allaah and His Messenger, in the verse: {Those who consume interest cannot stand [on the Day of Resurrection] except as one stands who is being beaten by Satan into insanity. That is because they say, 'Trade is [just] like interest.' But Allaah has permitted trade and has forbidden interest. So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allaah. But whoever returns to [dealing in interest or usury] - those are the companions of the Fire; they will abide eternally therein. Allaah destroys interest and gives increase for charities. And Allaah does not like every sinning disbeliever.} [Quran 2:275-276] Then, Allaah says (what means): {O you who have believed, fear Allaah and give up what remains [due to you] of interest, if you should be believers. And if you do not, then be informed of a war [against you] from Allaah and His Messenger. But if you repent, you may have your principal - [thus] you do no wrong, nor are you wronged.} [Quran 2:278-279]

This clearly shows the wisdom of Islamic legislation in addressing social and economic diseases. Indeed, Islamic legislation followed gradualness in endorsing many rulings because they were about matters related to habits to which the hearts of the people were very attached, and of course, abandoning it at once is difficult. So the wisdom of Allaah Almighty, the Most-Knowledgeable of His Creation, necessitated dealing with the people gradually. Moreover, the one who takes a closer look at that ruling will discover that Islam established all its economic regulations on a realistic basis of faith without making any social or economic blow in society at that time. It is for this reason that after the prohibition of interest, a Muslim is not demanded to refund what he earned during his previous life, because this would be a burden to him that he could probably not be able to repay. Allaah says (what means): {So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allaah. But whoever returns to [dealing in interest or usury] - those are the companions of the Fire; they will abide eternally therein.} [Quran 2:275]

Islam overlooks the previous sins and opens a new page for the dealings between the people.

Once, before the prohibition of interest, Bilaal ibn Rabaah  may  Allaah  be  pleased  with  him sold some dates in exchange for some other dates [with a difference of quality between the two], and the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) clarified to him that this was interest. Abu Sa'eed al-Khudri  may  Allaah  be  pleased  with  him reported:

Once, Bilal brought Barni dates (i.e. a kind of dates) to the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) and the Prophet asked him, 'From where have you brought these?' Bilal replied, 'I had some inferior type of dates and exchanged two saa’s of it for one saa’ of Barni dates in order to give it to the Prophet to eat.' Thereupon the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) said, 'Beware! Beware! This is definitely interest! This is definitely interest! Do not do so, but if you want to buy (a superior kind of dates), then sell the inferior dates for money and then buy the superior kind of dates with that money.'”

Ibn Katheer, while interpreting the verse, {So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allaah.}, said:

Meaning, those who have knowledge that Allaah made interest unlawful and refrain from indulging in it as soon as they acquire this knowledge, then Allaah will forgive their previous dealings in interest, as Allaah says {Allaah has forgiven what is past.} [Quran 5:95]; this is similar to what the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) said on the day Makkah was conquered, 'All cases of interest during the time of Jaahiliyyah are annulled and under my feet, and the first interest that I annul is the interest of Al-'Abbaas (the Prophet's uncle).'”However, the Prophet  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) did not instruct them to give back the interest that had been taken in the time of Jaahiliyyah; rather, he pardoned them for what they did in the past."

So this was part of the subject of interest and legislating a ruling about its prohibition; as regards research, there are some sites that you may contact and that could help you in that respect.

Allaah knows best.

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