THE USURY DOORS THESE HADITHS CLOSED

As these hadiths are in relation to usury and interest, they should not be considered from the perspective of trade; they should be evaluated in the context of debt transactions. Allah has separated trading process from the usury one categorically and has commanded:

“Those who eat usury cannot behave different from those who have been deceived by Shaitan. This is the reason they say, “Trading is just like usury”. Allah has allowed trading and forbidden usury…” (The Cow/ Bakara, 2 / 275)
      The Messenger of Allah has claimed: “Usury/ Interest can be only in debt.”[1] 

      In fact, people do not really need to exchange gold for gold, silver, silver, wheat for wheat, salt for salt, and dates for dates. However, this method can be relied upon in a place where trading is allowed and usury is forbidden in order to demonstrate usury as if it was trading. These words of the Messenger of Allah point to this:

“Do not sell one dinar for two dinars, one drachma for two drachmas and one sa[2] for two sa’s; I fear you might commit usury.”[3]

                                                      
      The phrase “I fear you might commit usury,” is important. The exchange of golden coins with a golden bracelet is genuine trading. Similarly, the offering of wheat in order to obtain the needed wheat flour is trading. In addition someone who needs sea salt exchanges it with the rock salt he might posses and this is also trading. The turning of such a trading process into interest-providing debt can be done by the performing of the sale on trust or by the exchanging of goods of unequal values. For this reason our Prophet has prevented usury by requiring the exchange of these six to be undertaken on the spot (cash) and scale to scale. Moreover he has allowed the exchange to take place if there was no fear of this exchange to be a means to usury. For example, even though he has forbidden the exchange of fresh dates with dried dates, he allowed the exchange of fresh dates on the tree with fresh or dried dates as a consummated domestic good[4]. We will focus later on these sale methods called “ariyye” and “araya”.

   The term “misil” (مثل) stands for equivalence between two things and expresses sameness. If referring to paying and price, the term means the paying of an equal value neither more, nor less. So in English it has been translated as scale to scale. Lisanü’l -Arab, gives the following information in relation to this term:
“Ibn Berri said that there is a difference between mümâselet (the condition of a misil for a misil – equivalence-) and müsâvât (equality). There can be müsâvât among goods of different genus and also among goods of the same genus, because müsâvât refers to the quantity. This means that one (of the goods) is neither more in quantity, nor less. However, the condition of mumaselet, meaning the condition of equivalence between two goods is relevant only for goods of the same type. Plainly the meaning of the phrase, “This is its misil” is “This can replace it.” If it is said that “This is its misil in this aspect”, it means that a good is the equivalent of that other in that aspect, but it is different from other perspectives.[5]
      There are a number of words in Arabic that refer to various shared features of things. Ragib el-Isfahânî provides the following information in relation to this subject:
Nidd (الند) refers only to mutuality/ partnership in essence.

 

Şibh (الشبه) refers only to mutuality in terms of quality and features.
Musavi (المساوي) refers to mutuality in terms of quantity and numbers.

Shekil (الشكل) refers to mutuality only in terms of size and dimensions

Misil (ال مث ل) refers to mutuality in all aspects mentioned above. The Glorified Allah has expressed that nothing is similar to Him in any aspects by the term “misil” commanding:
ليس كمثله شي ء.

“There is nothing misil (alike) to Him.” (The Counsel/ Shuura 42/11)[6]

      The hadiths have foreseen the exchange of gold, silver, wheat, barley, salt and dates with its own genus to be undertaken immediately (in cash) and in equal scales; as there might be a need to exchange golden coins for golden bracelets, silver coins for silver belts, pasta wheat for bread wheat and so on.

      The point of the hadiths is clear: If the exchange of this wheat with that wheat is supposed to be undertaken, the exchanged amounts have to be equal. If there is such a belief that a certain amount of wheat is more qualitative than others, then the selling of the wheat and the purchasing of another amount of wheat with that money is more adequate. For example, a person might sell his wheat for 1 unit and buy another for 0.9 units.

      The Messenger of Allah gave a duty to someone in Haiber. He brought dates of a good quality. “Are all the dates of Haiber of this quality?” he asked.

“No, by Allah, O Messenger of Allah! We get one sa[7] of this for two sa’s of the other and two sa’s of this for three sa’s of the other. Upon this he commanded:

“Do not do that; sell the dates you have collected for drachmas and later buy the qualitative dates with those drachmas.”

      Let’s see the usury doors the hadiths above have closed.

      1. The Exchange of the Six Goods with their own Genus Immediately (In Cash)

      The precondition to undertake their exchange immediately and in equal scales for the chief goods that can be lent has closed the main door to usury. Otherwise, the lending of 10 units in order to obtain 11 units would be considered usury, but the selling of 10 units for 11 units in an extended period would be concluded acceptable and the prohibition of usury would lose its meaning.
      2. The Exchange of Six Goods with their own Genus in Equal Scales

      The real target of the moneylender is to obtain 11 units for the 10 units he lent. If he is able to achieve this through a legitimate process, there is no need for him to turn this into debt. He first lends 11 units undertaking the necessary preconditions and later buys the 11 units in the hands of the debtor for 10 units in cash. Thus the debtor obtains 10 units but his debt is 11 units. Also, money-lending- institutions might be found this way. One of the desks lends 11 units to be paid in a year whereas that money can be sold for 10 units at the second desk. This is how the business goes on. If this process is not regarded as usury and is not prohibited, the prohibition of usury loses its meaning.

      Thus, in the old times in order to ensure the moneylender interest in legal terms a fake sale named muamele-i sheriyye was undertaken. For instance, the person who wanted to obtain a loan would place one of his properties in front of the moneylender and would say: “I sold it to you for 10 golden coins”. The moneylender would take the property and give him the money. Later he would tell to the debtor, “I am selling this property to you for 11 golden coins to be paid in a year’s time”. Thus, the debtor would take back his property and the 10 golden coins he was supposed to pay back with 11 golden coins in a year’s time. There were also other procedures for this.

      If it had been based on the verses of the Koran and the hadiths had been considered from the righteous perspective of Koran-Sunnah unity the muamele-i sheriyye would not have been given an option. This issue will be discussed in details in the following chapters.

      3. The Exchange of Six Goods with their own Genus in Trust

 

      If the exchange is undertaken in equal amounts but not immediately (in cash), usury might take place by the exchanging of a low-quality good with a good of the same genus and a higher quality after a period of time. The governor of Haiber brought the Messenger of Allah janib (high-quality) dates. He asked, “Are all the dates of Haiber of this quality?”. The governor replied, ““No, by Allah, O Messenger of Allah! We get one sa[8] of this for two sa’s of the other.” The Messenger of Allah said:

لا تفعلو ا. ولكن مثلا بمث ل. أو بيعوا هذا واشتروا بثمنه من
هذ ا. وكذلك الميزان.

“Do not do that, but it can be done a scale for scale. Or sell this and buy the other with its money. Balance is achieved this way.”[9]

 
      If there was not such a prohibition, a person in need would be given 100 kilograms of low-quality dates and would be required to bring 100 kilograms of janib (high-quality) dates. Due to the quality difference between the two types of dates the obtained interest would be about 50%.

      4. The Exchange Due to a Period of Time of Goods of the Same Category
      Gold and silver, as well as wheat and barley are goods of the same category; thus they can be used instead of each-other. The rates between their values do not change significantly in long periods of time. Their exchange in extended periods of time, arises the opportunity to include the transaction into the debt concept. Hadiths have closed this door by forbidding their deferred exchange.
      For example, if one dinar is worth 10 drachmas, 1000 drachmas are worth 100 dinar. If the deferred exchange of these values had been possible, the moneylender would sell his 1000 drachmas for 110 dinars in a year’s time and he would be lending money with a 10% interest rate hidden behind the image of trade. The same is also possible for barley and wheat.  If the value of two kilos of wheat is equal to the value of three kilos of barley, 200 kg wheat are given in order to receive 400 kg barley in a year’s time, thus demonstrating debt usury as a form of trading. Hadiths have closed this door too, by considering this not as a type of trading of, but as an interest-bearing transaction.

      According to this, foreign currency is not allowed to be purchased due to a different time. As they are good of the same category and hold the ability to replace each other it is not difficult to understand that they can easily become means to applying usury. The precondition for their in cash exchange, has closed that door.

      5. The Exchange of Money in Compliance with their Value of the Day

      In the hadith of Abdullah b. Omar (r.a.) mentioned above, the exchange of dinar with drachma in cash has not been considered sufficient; moreover, its undertaking in compliance with the daily exchange rate has been required. Because of, the moneylender lends 11 dinars when 1 dinar is equal to 10 drachmas and takes all the necessary precautions and later on purchases the 11 dinars with 100 drachmas. Thus, he has lent 100 drachmas with a 10% interest rate.

      The exchange of these goods in compliance with the daily exchange rate has closed this door. Consequently, these hadiths have significantly minimized the opportunity of masking usury under the image of trade. Other opportunities have been debunked by other hadiths. 

      The minimization of the opportunity to apply usury has also led to a number of problems. For example, according to the hadiths jewelers can purchase golden bracelets by giving scrap of gold or other forms of the metal only by undertaking the exchange immediately (in cash) and in equal scales. As nobody would do this, the sale of golden bracelets can be done only by their purchasing with silver or any other type of currency.

      The problems the banning of usury have led to, have also led to a big benefit as the significant minimization of the opportunity to apply usury is. Such a situation deserves being the reason behind this ban. In fact, the clarification of the ban of alcohol and gambling has been done as below:

“They ask you about alcoholic drinks and games of chance. Say: In both of them there is a great sin and also means of profit for mankind. Yet their sin is greater than their profit.”  (The Cow/ Bakara 2 / 219)

     In Islamic jurisprudence, this issue has been defined on these bases: “Def mefâsid the celb-i

menâfi’den evlâdır.”[10]  That is, the elimination of harmful things is preferred to the obtaining of useful ones. If hadiths had not commanded these bans, institutions that would offer interest-bearing loans under the image of the trading of valuable goods would have been founded, which would have made the prohibition of usury meaningless.


[1]

[2] According to the Hanafi sect a sa is a scale that contains about three kilograms (2920 grams) of wheat or barley.

[3]

[4]

[5]

[6]

[7] According to the Hanafi sect a sa is a scale that contains about three kilograms (2920 grams) of wheat or barley.

[8] According to the Hanafi sect a sa is a scale that contains about three kilograms (2920 grams) of wheat or barley.

[9]

[10] Ibn Manzur, Lisanu’l-Arab, chapter “SFK”

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Date: Jul 11, 2010