"[15][Note 2] Muhammad Taqi Usmani—"one of the leading" modern day "religious experts on Islamic finance"[21]—disagrees, arguing that scripture concerning riba could not possibly be ambiguous (mutashabihat) because God would not condemn a practice without revealing its "correct nature" to Muslims.
[75][76] Taqi Usmani maintains that outside of Dar al-Islam, riba (interest on loans) allowed the Rothschild family to "acquired financial mastery over the whole of Europe and the Rockfeller [sic] over the whole of America".
[77] The orthodox prohibition on interest was reconsidered by Islamic Modernists starting in the late 19th century in reaction to the rise of European power and influence during the Ages of Enlightenment, Discovery and colonialism.
[85] The prime example being modern scholars such as Grand Mufti of Saudi Arabia, Abd al-Aziz Bin Baz, based their fatwas about riba definition on the basis of Ahadith that narrated by Ubadah ibn al-Samit.
[101][107] According to Farhad Nomani, in studying scholarly "commentaries, one notes that the technical, and even to some extent the customary meaning of riba as a practice in pre-Islamic era, is a matter of controversy among classical jurists and the interpreters of the Qur'an.
[114] Usmani writes: the objection of the infidels ... was that when they increase the price at the initial stage of sale, it has not been held as prohibited but when the purchaser fails to pay on the due date, and they claim an additional amount for giving him more time, it is termed as "riba" and haram.
Farooq argue that classical scholars believed that hadith (the body of reports of the teachings, deeds and sayings of the Islamic prophet Muhammad that often explain verses in the Quran) was needed to define riba.
Some note the wording of aya 3:130,[140] Imam Ahmad ibn Hanbal (780–855 CE), believed only Riba al-jahiliya (where the amount owed "doubled and redoubled" each year if not paid off) was unlawful "without doubt from the Islamic viewpoint".
"[166] Replying to the non-orthodox, Taqi Usmani argues that scripture concerning riba must not be categorized as ambiguous (or mutashabihat) because God can not "wage war against a practice, the correct nature of which" is unknown by Muslims.
[174][173] Another (non-Muslim) scholar (Olivier Roy) points out Ayatollah Ruhollah Khomeini's book of fatawa Tawzih al-masa'il, written before 1962,[Note 27] as an example of a more traditionalist attitude toward riba, or at least the charging of interest on loans.
Farooq cites another critic, Abdullah Saeed, who complains that the schools of Islamic jurisprudence have ignored "rationale/wisdom" (hikmah) and arrived at a legal "cause" (`illa) to determine what was riba "which had nothing to do with the circumstances of the transaction, the parties thereto, or the importance of the commodity to the survival of society.
"[179] One result of this legalistic thinking is that hiyal could be and has been used "from the medieval period to the present day", to create loans based on "fictitious transactions" charging "exorbitant rates of interest" approved by orthodox jurists as lacking riba.
[83] Scholars and authors who have declaring that there is a religious consensus (ijma) on the subject include Abul A'la Maududi (1903–79), Yusuf al-Qaradawi, Wahbah al-Zuhayli, Tariq Talib al-Anjari, Thanvir Ahmed, Mabid al-Jarhi, M.N.
Among some (such as Imran Nazar Hosein) interest on loans constitutes not just a sin or crime but the "grand design of hostile forces who have already made considerable progress, through riba, in gaining control over mankind.
[208][Note 34][210] The "thin ranks"[211] of notable contemporary non-orthodox scholars[212] include Fathi Osman, Nawab Haider Naqvi, Salim Rashid, Imad al-Din Ahmed, Omar Afzal, Raquibuzzaman, Abdulaziz Sachedina, Abdullah Saeed, Mahmud El-Gamal and Mohammad Fadel.
[231][Note 37] ... "There are areas in which human reason cannot give proper guidance ... [thus] it is the firm belief of every Muslim that the commands given by the divine revelations ... are to be followed in letter and spirit and cannot be violated or ignored on the basis of one's rational arguments ..."[233][234] In any case, Usmani writes, injustice (zulm) "is a relative and rather ambiguous term the exact definition of which is very difficult to ascertain".
(While some Islamist thinkers have promoted the idea that 'labor owned firms would express the spirit of Islam better' than conventional ones,[Note 39] there is no movement to restrict businesses to profit-sharing payment for employees or even much debate on the issue.
[294] Abul A'la Maududi calls interest "the greatest instrument by ... which the capitalist tries to concentrate in his hands the economic resources of the community",[295] proclaiming "there is hardly a country in the world in which money-lenders and banks are not sucking the blood of poor labouring classes, farmers and low-income groups".
"[299] Among the claims that interest plays a negative role in the economy include that it squeezes out productive investment, encourages speculation, creates credit bubbles, fuels inflation, instability, unemployment, depressions and imperialism.
Khan replies that the harm created by interest cannot be that severe as interest-based finance is "deeply entrenched" in the developed countries of the OECD, where per capita income is quite high and the percentage of poor people relatively low.
By the late 20th century a number of Islamic banks formed to apply riba/interest-free principles to private or semi-private commercial institutions within the Muslim community,[334][335] In the 1980s the Pakistan regime of General Muhammad Zia ul-Haq condemned the "curse of interest" and promised to eliminate it.
[348] Critics complained that in the eyes of standard accounting practices and truth-in-lending regulations there is no distinction between (for example) getting 90 days credit on a Rs10000 (cash price) product and paying an extra Rs500 (allowed), or taking out a 90-day loan of Rs10000 that charges interest totaling Rs500 (forbidden).
[112] Usmani insists that the phrase "God has permitted trade..." from Quranic verse 2:275, refers to credit sales such as murabaha,[351][352] so that "taking the time of payment into consideration" in paying more for a product/commodity, does not come "within the ambit of interest", i.e.
[29][Note 50] Makkan lending (Riba al-jahiliya) involved high interest rates charged by rich money lenders to poor customers who borrowed for purposes of consumption,[235] and led to the accumulation of large debts and often financial slavery.
In contrast, most money loaned in contemporary society is for commercial purposes and investment, transacted between sophisticated parties, offering/paying interest rates determined and kept low by a competitive and regulated market[236]—most of these features not in existence when the Quran was revealed.
[29] Islamic Modernist scholar such as Fazlur Rahman Malik,[387] Muhammad Asad,[388] Sa'id al-Najjar,[389] Sayyid Tantawi,[139] differ from the orthodox interpreters in arguing that interest is not riba unless it involves exploitation of the needy.
[398] Most of these arguments have been criticized by Islamic revivalist writers, including Siddiqi, Zarqa, Khan & Mirakhor and Chapra, and especially by Taqi Usmani's "Judgement on Interest Delivered in the Supreme Court of Pakistan".
Usmani quotes condemnations of speculation by various Western sources[423][Note 53] and the writings of the celebrated medieval Islamic scholar Al-Ghazzali that money was made to facilitate trade and should never be hoarded or used to charge interest.
[434] According to Ibrahim Warde, Islamic banks face a serious problem with late payments, not to speak of outright defaults, since some people take advantage of every dilatory legal and regal and religious device ...
As a result, `debtors know that they can pay Islamic banks last since doing so involves no cost` [435][434]Warde also complains that "Many businessmen who had borrowed large amounts of money over long periods of time seized the opportunity of Islamicization to do away with accumulated interest of their debt, by repaying only the principal—usually a puny sum when years of double-digit inflation were taken into consideration.