This makes this type of lending prohibited in the Judeo-Christian-Islamic
tradition.
Another interesting practice by the pagan Arabs was ofNass’ee,or
transposing the months of the lunar calendar they used in order to suit their
needs. Nass’ee could involve shifting the end of the calendar year to coin-
cide with a special event; in many cases, the calendar could be accelerated
or manipulated to render large riba-based contracts in default. Manipulat-
ing the calendar could generate a large amount of delinquency payment for
the lender through the practice of riba al nassee’aa. The Qur’aan says about
the prohibition of this type of riba:
9:37 Verily the transposing (of a prohibited month) is an addition
to Unbelief: the Unbelievers are led to wrong thereby: for they
make it lawful one year, and forbidden another year, in order to
adjust the number of months forbidden by God and make such for-
bidden ones lawful. The evil of their course seems pleasing to them.
But God guides not those who reject Faith.This variety of riba has been prohibited in the original teachings of
Moses (pp) and Jesus (pp), but was relaxed later. Shari’aa still renders these
transactions as haram (divinely prohibited).
Riba Al-Fadl This type of riba is defined as taking a loan for payment at a
later date for a higher value, or selling an item for a profit (the wordfadl
means an excess over the cost or a premium). An example of this type of
riba in today’s lingo would be taking a $100,000 personal consumer loan
from a bank and promising to pay $120,000 back in two years, or bor-
rowing ten pounds of rice and promising to pay it back in the form of
twenty pounds of rice after one year. Another practice in the market-
place was the bartering of goods of different types, natures, and qualit-
ies. For instance, one would exchange ten pounds of small-sized and
low-quality dates for two pounds of larger, high-quality dates. The criti-
cal question in these types of transactions is the level of the premium
used, what makes it 20 to 50 percent higher at a later date, and what
index should be used to determine thatpremium. Another factor in these
transactions is how to regulate transactions to minimize deception, spec-
ulation, and hoarding activities in the marketplace, thus establishing a
fair market price. Such practices were all prohibited by the Prophet Mu-
hammad (pp) in order to ascertain healthy markets that reflect the true
forces of supply and demand. This type of riba has been prohibited for
two purposes:
42 THE ART OF ISLAMIC BANKING AND FINANCE