Definition Of Riba

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QUESTION 1: EXPLAIN THE FOLLOWING: A. WHAT IS MEANT BY RIBA? DEFINE THE KINDS OF RIBA? Definition of Riba: In the literally meaning Riba is excessive or addition, but in the meaning of Shariah under Islamic Economy is the excessive that is prohibited. Also the word "Riba", in Arabic language, means an "increment' or addition". In Islamic Fiqh the term Riba has a special meaning that is an unjustified increment in borrowing or lending money, paid in kind or in money above the amount of loan, as a condition imposed by the lender or voluntarily by the borrower. Riba has been used in the Holy Qur’an on several verses also is described in the several ahadith. So it is necessary to know what it means or what it really stands for Riba . As described above, For examples Interest when money become a commodity and bought and sold with guaranteed results of profitability or the increase of volume of money by using in the transaction. Such increase is the price of money and the price of that money is classified as Interest which is part of Riba. Riba is clearly explained in Quran and Hadith while interest is explained by scholars Greek Scholar Aristotle define Interest in his book “Money and Politics” as “Interest” is an artificial profit which does not enter in legal trading. Using money as a commodity is selling, just a forged artificial transaction. Money has to be used as a means of sale and purchase and measurements of a commodity to be sold or purchased within similar quantities and qualities. Actually interest is the one of categories of Riba for the reasons that interest is taken over and above to principal amount, without any risk, efforts, activity without loss sharing and the return is guaranteed within a specific time. Riba is regarded as unjust because it is received without any sharing in risk or contribution of any labor or other activities for which a payment or reward has been

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