Debt: Islamic Perspectives & Views

In this current situation where poor countries are made to pay millions of pounds in servicing their debts but have no way of providing their citizens with basic services is clearly morally and ethically wrong. Frequently poor countries are spending more on debt repayments than on providing for their citizens’ most basic needs. The fact that these unjust debts have not been cancelled in full by fair and transparent methods means that the world’s poorest countries are trapped in a cycle of poverty unable to invest in education, child diseases, HIV, prevention and treatment, and the preservation of precious environmental resources.  Yet as well as the moral and ethical arguments, for Muslims there are also strong and clear faith-based reasons for supporting debt cancellation. Here it comes the concept of social justice is paramount in Islam. Muslim teachings advocate for a fair and equitable distribution of wealth, the protection of the weak against economic exploitation and...

Oxford English Dictionary define term 'debt' as a sum of money that is owed or due. Islam takes the matter of debt very seriously and warns against it and urges the Muslim to avoid it as much as possible. It was narrated from ‘Aa’ishah (may Allaah be pleased with her) that the Prophet (peace and blessings of Allaah be upon him) used to say in his prayer: “Allaahumma inni a’oodhi bika min al-ma’tham wa’l-maghram (O Allaah, I seek refuge with You from sin and heavy debt).” Someone said to him: “How often you seek refuge from heavy debt!” He said: “When a man gets into debt, he speak and tells lies, and he makes a promise and breaks it.” Narrated by al-Bukhaari (832) and Muslim (589).   As we all know, riba' may easily found in any transaction that related to debt. In Holy Quran, Allah said, “And whatever riba you give so that it may increase in the wealth of the people, it does not increase with Allah.” [Ar-Rum 30:39]  Debt is permissible if there are no any ad...