I borrowed a sum of money from the bank to start a poultry farm project, and this amount is subject to an annual interest rate, secured by land that I own. I carried out the project, but the profit was not sufficient to repay this debt.
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The questioner : I borrowed a sum of money from the bank to start a poultry farm project, and this amount is subject to an annual interest rate, secured by land that I own. I carried out the project, but the profit was not sufficient to repay this debt, so I was forced to come to the Kingdom to work in order to make the repayment. My question is: Is this amount considered riba (usury or interest), and what is the zakah (obligatory alms) that must be paid on this project? Please advise us so that we may put our conscience and heart at ease. May Allah reward you with good?
The Shaykh : Praise be to Allah, Lord of the worlds, and I send prayers and peace upon our Prophet Muhammad, and upon his family and all his Companions:
This question contains two issues:
The first issue: A man borrowing from a bank with interest, and this is undoubtedly riba (usury or interest). This is because selling currency for currency on credit is not permissible. If, in addition to that, a profit is added that is charged for each year, it becomes a combination of the two types of riba (usury or interest), namely riba al-fadl (usury of excess in a like-for-like exchange) and riba al-nasi'ah (usury of deferment). Riba (usury or interest) is not a trivial matter; rather, it is among the major sins about which Allah the Exalted said:[Al-Baqarah 2:278-279]. He (Mighty and Majestic) informed that He has forbidden riba (usury or interest) and said: [Al-Baqarah 2:275]. Musnad Ahmad 844Sahih, because of corroborating evidence; this is a da'eef isnad because of the weakness of Jabir Al-Ju'fi and Al-Harith al-A'war] (Darussalam) meaning in the curse, and I seek refuge in Allah. And he (peace and blessings be upon him) said: Sahih Muslim 1587c. And he informed that whoever increases or demands an increase has committed riba (usury or interest). And he said: Sahih Muslim 1587c. So if you borrow money from a person with interest, this is not truly a loan, but rather a sale. Because the intention behind a loan is to be kind and do good, whereas what took place between you two is not intended to be kind or do good, but rather to exchange, profit, and earn. Therefore, it is riba (usury or interest). You must repent to Allah (Mighty and Majestic) for that and not return to such a thing.
As for the obligation of zakah (obligatory alms) in this project, anything from this project that is prepared for sale is subject to zakah (obligatory alms). As for the remaining machines and tools used for production, there is no zakah (obligatory alms) on them because they are not merchandise for trade, as they are prepared for use. And the Prophet (peace and blessings be upon him) said:Musannaf Ibn Abi Shaybah 36:334.
The Shaykh : Praise be to Allah, Lord of the worlds, and I send prayers and peace upon our Prophet Muhammad, and upon his family and all his Companions:
This question contains two issues:
The first issue: A man borrowing from a bank with interest, and this is undoubtedly riba (usury or interest). This is because selling currency for currency on credit is not permissible. If, in addition to that, a profit is added that is charged for each year, it becomes a combination of the two types of riba (usury or interest), namely riba al-fadl (usury of excess in a like-for-like exchange) and riba al-nasi'ah (usury of deferment). Riba (usury or interest) is not a trivial matter; rather, it is among the major sins about which Allah the Exalted said:
(278) O you who have believed, fear Allah and give up what remains [due to you] of interest, if you should be believers. (279) And if you do not, then be informed of a war [against you] from Allah and His Messenger. But if you repent, you may have your principal - [thus] you do no wrong, nor are you wronged.
يا أيها الذين آمنوا اتقوا الله وذروا ما بقي من الربا إن كنتم مؤمنين فإن لم تفعلوا فأذنوا بحرب من الله ورسوله وإن تبتم فلكم رؤوس أموالكم لا تظلمون ولا تظلمونBut Allah 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 Allah. But whoever returns to [dealing in interest or usury] - those are the companions of the Fire; they will abide eternally therein.
وأحل الله البيع وحرم الربا فمن جاءه موعظة من ربه فانتهى فله ما سلف وأمره إلى الله ومن عاد فأولئك أصحاب النار هم فيها خالدونThe Messenger of Allah (ﷺ) cursed the one who consumes riba, the one who pays it, the two who witness it, the one who writes it down
ولعن النبي صلى الله عليه وسلم آكل الربا وموكله وشاهديه وكاتبه وقال هم سواءGold is to be paid for by gold, silver by silver, wheat by wheat, barley by barley, dates by dates, and salt by salt, like for like and equal for equal, payment being made hand to hand
الذهب بالذهب والفضة بالفضة والبر بالبر والشعير بالشعير والتمر بالتمر والملح بالملح مثلاً بمثل سواءً بسواء يداً بيدIf these classes differ, then sell as you wish if payment is made hand to hand.
إذا اختلفت هذه الأصناف فبيعوا كيف شئتم إذا كان يداً بيدAs for the obligation of zakah (obligatory alms) in this project, anything from this project that is prepared for sale is subject to zakah (obligatory alms). As for the remaining machines and tools used for production, there is no zakah (obligatory alms) on them because they are not merchandise for trade, as they are prepared for use. And the Prophet (peace and blessings be upon him) said: