Thanks Grateful

Most Bible College lecturers tend to teach their students that the Bible interprets itself. This is certainly what I was taught.

Deuteronomy 15:7“If among you, one of your brothers should become poor, in any of your towns within your land that the LORD your God is giving you, you shall not harden your heart or shut your hand against your poor brother,...

Here the 'brothers' refers to fellow Israelites - ie extended family which is what Israel was - the combined families of 12 brothers; the sons of Jacob. Deut 17:15 Do not place a foreigner over you, one who is not a brother Israelite...so the term 'brother' extended to the household of Israel as a family. Deut 18:15 prophesies of the prophet like Moses who will be from 'among your own brothers' - clearly with consistent interpretation this refers to a fellow Israelite. So 'brother' is a broad term. to be continued:
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In the same way that Islam refers to the Umma as an extended family - Israel is a family and we are told to do good to all but 'first to the household of God'. (Galatians 6:10) That's the Biblical principle so we can define it as Jews and Gentiles or family and others but we are not really disagreeing - these are labels for the same thing.
Yet when we look at the texts about not charging interest the context is in lending to the poor among us. I'm afraid I haven't the time to go fishing for scholarly opinion - as I said - the scholars that I've read affirm the Bible interprets itself. I accept I am not a Biblical scholar but I don't think anything I've said contradicts common sense and the ordinary understanding of the text. As a Christian we take principles from the Torah - not laws as such because Jesus brought what he referred to as the 'New Covenant' - a way to understand the spirit of the law. And he came to remove the wall of hostility between Jews and Gentiles by destroying (divisive) commands and regulations.(Ephesians 2:14-15) So you may consider these things or remain skeptical. Please feel free to google commentaries on Math 25:26 - you may decide for yourself. I'm sorry if it was understood i endorsed payday loans - that was not my intent. It was the reason he wouldn't wear it. If he receives money from interest bearing accounts and supported Virgin money- it wasn't no interest sharia standards he is supporting at all - just lower interest - something everyone would support. Why play the sharia card?

Vikkie, thank you for your response
In relation to the Islamic injunctions agains interest (or more broadly riba), this is a prohibition on any Muslim giving, receiving or facilitating any such transaction. It makes no difference whether another party is Muslim or not: a Mulsim cannot borrow from, or lend to or facilitate an interest-bearing loan between anyone whether they be Muslim or non-Muslim.

The qur’an instructs us to engage in trade and riba is not trade. An interest-based loan exchanges one dollar for more than one dollar. Trade exchanges goods or services for money and then money for goods and services.

The Islamic transaction that most people cite as being merely a replication of a conventional loan is called a Murabaha. A Murabaha involves one party buying an item and reselling it and disclosing the profit to the buyer. When payment is delayed then you effectively have a trade credit. If i wanted to buy a car then a financial institution would first buy the car for say $100,000 and sell it to me for $110,000 in one years time (with all sort of payment schedules) and the bank would be obliged to disclose the $10,000 profit.

Those who claim this operates just like a loan fail to see some fundamental differences:

Firstly, under a conventional loan the borrower can take out a $100,000 saying that they intend to buy a car for their business, but instead spend it on a holiday in Bali (moral hazard). This is not possible under a Murabah.

Secondly, if payments are late under a conventional loan, there will be a penalty interest rate applied. Under a Murabah no such penalties are possible (because they effective amount to Riba). Yet a penalty can be charge which is called a charity clause. The debtor can be charged a late penalty with all proceeds going to charity (and not the creditor).

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Third, a loan cannot be repaid with another loan. Remember, a further debt can only be contracted against acquisition of asset. So the original car purchaser cannot repay the original debt by contracting a new loan.

The result:individuals may get in over their heads by making a purchase which they cannot repay, but their indebtedness cannot accumulate as would be the case under a conventional loans. In particular, the subprime lending scams that triggered the GFC would be inconceivable.

Vikkie,i'd like to ask whethere there anything here that you would object to?

Thanks Gratfeul.

You say there is an Islamic injunction against giving, receiving or facilitating interest. As Islamic banks are a fairly new phenomena - what happened in the past 1300 years? In Australia I'm sure Muslims are receiving wages, Centrelink payments and running profitable accounts and businesses - are these all forbidden simply because they can no longer give, receive or facilitate interest? Isn't this a recipe for poverty? (something pretty evident in many Muslim majority nations once oil is removed from the equation).

Conventional loans generally do go straight to the car company, bank financing your home etc - so not sure why you think they are more open to corruption. Why is a holiday in Bali a 'moral hazard?' I suppose a criminal mind or very dishonest person will always find a way around the system but essentially the system is based on reasonable trust, as are all successful relationships.

I don't understand why the sharia 'penalty clause' is more ethical than a conventional penalty paid to the creditor; the creditor is left holding the shortfall and yet instead of receiving compensation for a breach of contract a third party charity benefits. (Many of these charities already having been identified as fronts for Islamist causes).

You say a loan cannot repay another loan. Are you saying sharia banks are all cashed up and have not loaned the finance put up for sharia financed homes? Many financial advisors recommend consolidating loans into one - that is paying a loan with a loan - a very effective way of managing and eventually eradicating debt.

The bottom line is that we disagree about 'interest' necessarily being unethical. And I certainly disagree that sharia law itself can offer equitable moral outcomes when sharia discriminates against non-Muslims in law.

Hi Vickie,

"Conventional loans generally do go straight to the car company, bank financing your home etc - so not sure why you think they are more open to corruption. Why is a holiday in Bali a 'moral hazard?' I suppose a criminal mind or very dishonest person will always find a way around the system but essentially the system is based on reasonable trust, as are all successful relationships."

In this case, obviously if the money is spent on anything other than its intended purpose, then its a result of moral hazard.

And of course we are talking of the relationships that are not so successful ...for example the Greek debt crisis which arose from loans being used to feed graft (http://www.greekcrisis.net/2010/08/tragic-flaw-graft-feeds-greek-crisis.html). Look at the suffering this has inflicted on Greeks, savers and taxpayers in other European countries. This scenario would have been practically impossible under shariah-compliant financial arrangements.

"Many of these charities already having been identified as fronts for Islamist causes".

What's an "Islamist cause"?

A charity is an Islamic cause, indeed one of the five pillars. Nor does it discriminate against non-Muslims:

"And do good, for Allah loves those who do good." [Qur'an, 2.195]

And see the following fatwa: http://spa.qibla.com/issue_view.asp?HD=1&ID=4717&CATE=43

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