The Qur'an and Usury

The Qur’an is uncompromising in its prohibition of usury which was practiced by the Jews in Medina. * Those involved in usury transactions are demonised as touched by evil and driven to madness:

ll.275. “ Those who devour usury
Will not stand except
As stands one whom
The Evil One by his touch
Hath driven to madness.
That is because they say:
‘Trade is like usury,’
But God hath permitted trade
And forbidden usury...”

Variations exist in the interpretation of usury and whether it relates to monetary transactions. There is, however, a strong argument for the prohibition of deferred payment even in selling **

Usury, which applied to deferred payment for food by the needy, would often lead to slavery in the early days of Islam. The underlying cause for the prohibition of usury is , thus, to forbid the enslavement of the needy.

However, as with many teachings of the Qur’an, the spirit of the law was abandoned to allow for the ills of slavery which remains legitimate in Islamic jurisprudence, to date.

Sources:

* Montgomery Watt and Richard Bell. Introductions to the Qur’an.
** see M. Said Al-Ashmawy. Al-Ribaa wal Faida fil Islam