Ribā goes beyond interest and debts.

Associating ribā with interest and debts obscures the various forms of ribā that exist in the modern economy. It also hinders our ability to refrain from it.

Whether you are a follower of the Mālikī school or not, what follows will still be useful in understanding how the concept of ribā goes way beyond the basics of debt and interest. If anything, it should impart some concepts to better help you situate yourself in the legal and ethical discourse surrounding some prohibited transactions, regardless of your madhhab affiliation (or lack thereof).

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First off, if you have in your mind some concept of ribā as interest or usury, please erase this thought from your head. Start from scratch. Ribā is an empty word. Now we will fill it in with concepts that are based in the legal tradition.

One of the enduring features of Islamic law is its internal system of logic. Concepts like genus and species, when they occur in the legal literature, should be understand within the context of the law and not in any scientific sense. Therefore, when you read “genus” in the paragraphs to follow, please think of it as a "broad category under which subcategories exist." To make it easier to follow, I'll be using “cats” as an illustration of the concept of genus. Do not get bogged down by the fact that the genus is "felis" and the species is "cat/catus." We're dealing with a basic taxonomy here to help us understand how the Shari'ah deals with this, not a scientific taxonomy.

That said, let's begin.

Sometimes a term may be used in a general sense, as well as a specific sense. The word "cat" can be used to refer to the entire category of "cats"—the genus of cats under which falls the lion, tiger, cheetah, and house cats. The word "cat" can also be used for a specific type within this genus—the domesticated cat, to the exclusion of the lion, tiger, and cheetah.

When Allah says in the Qurʾān, "Allah has made permissible trade (bayʿ) and forbidden ribā," what is meant is the general meaning of ribā—i.e. the "genus" of ribā. This genus of ribā encompasses all ḥarām transactions. How did we get to that? Let's look at the verse again: Allah calls what He permits "trade" and calls what He forbids "ribā." That means that trade (bayʿ) refers to those transactions that are permitted by Allah, and ribā refers to whatever is not permitted by Allah. This is the general meaning of ribā: ḥarām transactions. In other words, where "cat" (when used in a general sense) refers to the genus of cats, ribā (when used in a general sense) refers to the genus of ḥarām transactions.

But just like the word "cat" has a specific meaning that refers to the domesticated cat, the term "ribā" has a specific meaning that refers to specific types of transactions that contain issues in them. It is because of these issues that they are ḥarām and therefore part of the larger category/genus of ribā (i.e. ḥarām transactions). But not all ḥarām transactions contain these same issues. In other words, not all ḥarām transactions are ribā.

To borrow the cat analogy, here we have several "types" of domesticated cats. In other words, we use the word "ribā" (in a specific sense) to refer to types of transactions based on the issue involved in that transaction which makes it ḥarām.

For purposes of our discussion here, we will speak only of two types of ribā. The third one, which is associated with debts and is not restricted to specific items of exchange, will be discussed at some later time. The term ribā is used in a specific sense to refer to the following two types of transactions:

(1) ribā al-nasīʾah: a transaction with deferred delivery of items which the Sharīʿah requires be exchanged at the same time.

(2) ribā al-faḍl: a transaction with in which you have two items of the same genus being exchanged at different quantities (i.e. differing counts or weights).

These two transactions only take place when specific, restricted items are involved. Not all types of items are subject to these restrictions. Goods such as computers will never result in ribā al-nasīʾah nor in ribā al-faḍl. This does not mean that you cannot have a transaction where you're giving money for computers and there's ribā involved. Rather, it just won't be these two types of ribā; it may be the last type of ribā which is associated with debts.

So what are the specific types of items that are restricted in such a way that certain transactions containing them may fall under the category of ribā al-nasīʾah or ribā al-faḍl?

For ribā al-nasīʾah, wherein the problem relates to an exchange at different times, we have the following restricted items:

(1) Foodstuffs — the issue is with edible/consumable foodstuffs (medicine is exempted).

(2) Currency — the issue is with anything that is used as a measure of exchange value (thamaniyyah).

Transactions in which (1) the buyer and seller exchange food from both their ends, or (2) exchange currency from both their ends—these transactions may be deemed as ribā transactions if they violate the rule associated with them: that they must be exchanged at the same time. In other words, if a person buys 1 kg of apples in exchange for 1 kg of grapes, but the buyer gives the grapes a day after he receives the apples, then the transaction is forbidden and therefore invalid. It violated the rule against ribā al-nasīʾah since we have deferred payment in a transaction of foodstuffs for foodstuffs. The same goes if one were to exchange $50 USD for 40 EUR, but the two currencies are handed over at different times. Ribā al-nasīʾah requires that these kinds of items, in these types of transactions (i.e. foodstuffs<>foodstuffs, currency<>currency), maintain strict delivery rules with respect to the items of the contract: they must be exchanged at the same time.

If you notice, this is not the typical understanding we have of ribā but this is indeed ribā. Not only is this ribā—it's ribā in the specific sense of the word. This is a type of ribā that the sharīʿah has prohibited. This is why we have to empty our minds of the connotations associated with ribā before we can come to learn the proper meaning of the term. It's also why we need to rely on Arabic as no English equivalent exists that will offer you the full meaning of the term and how its used in the context of the Sharīʿah.

As for ribā al-faḍl, wherein the problem is related to unequal exchange of the same genus of items, the specific items which are restricted are:

(1) Foodstuffs — the issue is with essentially nourishing and storable food (e.g. rice, barley, wheat, millet, dates, raisins). [Note: this is more confined than ribā al-nasīʾah which dealt with all edible foodstuffs except medicine]

(2) Currency — the issue is with anything that is used as a measure of exchange value (thamaniyyah).

In the case of ribā al-faḍl, we look to see if a transaction contains (1) two items of the same genus, and (2) unequal exchange based on quantity, i.e. weight or count. Keep in mind that when it comes to foodstuffs here, the type of foodstuffs is restricted to those that are essentially nourishing and storable. This is the same list of foodstuffs that are mentioned in discussions on zakāt that is due on seeds and agricultural produce. So, if we have a transaction wherein 10 lbs of Jasmine rice is exchanged for 15 lbs of Basmati rice, we have violated the rule against ribā al-faḍl. The same goes were we to give $20 USD in exchange for $30 USD. That is, we have exchange of a restricted class of items (i.e. currency) wherein the items of the transaction are (1) part of the same genus, i.e. dollars, and (2) unequal in quantity, i.e. count.

Now, a transaction may violate both ribā al-faḍl as well as ribā al-nasīʾah. An example would be giving someone 10 lbs of Jasmine rice today in order to receive 15 lbs of Basmati rice one week from today. We are dealing with unequal exchange in two items of the same genus of a restricted class, namely foodstuffs that are essentially nourishing and storable. Therefore, the transaction violates the rule against ribā al-faḍl. Moreover, we have an exchange of a restricted class of items, foodstuffs that are edible, in which delivery of the items occurs at different times. Hence, the transaction violates the rule against ribā al-nasīʾah.

All-in-all, the key takeaway is that once you've emptied your mind of the idea that ribā is only related to debts and interest, then you'll more easily grasp the broad range of transactions that are considered to contain ribā in them. It will also make sense why there is so much concern about staying away from ribā, even in transactions that have nothing to do with "usury," "loans," "debts," "credit cards," "mortgages," or anything else that is usually associated with the ribā-as-interest concept that has so thoroughly burrowed its way into our minds as Muslims.

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This was written as a response to a student in a course I'm teaching on behalf of Pillars Seminary. I figured others may benefit from it as well. To learn more about Pillars Seminary, please click here.