Tuesday, January 18, 2011

When Risk is Four Letter Word (The Edge, Malaysia January 17 2011)

My Say : When risk is a four-letter word

Written by Zahid Aziz  Monday 17 January 2011

This article appeared in Forum page of The Edge Malaysia, Issue 841, Jan 17-23, 2011

The objection of Islamic Syariah to riba has never been about the size of the interest charged. It is also not confined to consumption loans; it is prohibited also to investment loans.

Investment loans, isn’t that a misnomer in the first place? How could an investment be a loan, and how could a loan be an investment? That is the objection of Syariah to riba, an investment cannot be a loan, and a loan cannot be an investment. But we have accepted the fraud and spun it that a loan is an investment without question. For how else could we have agreed to a guaranteed return to someone who has lent us capital?