PROFIT, RENT, FEE, INTEREST AND KENZ
The concepts we used as the title of our article are the issues that concern the Muslims very closely and are worth narrating in hundreds of pages. Hence, our valuable Islamic law scholars have expressed these issues in volumes throughout history. We will try to present the issues very briefly and clearly in encyclopedic scales.
In order for us to distinguish these concepts we used as the titles from each other, we are presenting them in summary:
“Fee” means the “amount designated for a job done”. That is to say, fee is the return of labor. This means that if a person works, he/she is entitled to remuneration in return of his/her working. In this context, the name of a person who works is a “worker”.
A person who works for a person or an organization for a particular time or on a daily, weekly, annually basis is referred to as a “private worker”, and the person who works for everyone, such as traders or small-scale artisans are called “common workers”. Both of them deserve a wage by the sweat of their brow.
When worked without cheating and wasting the shift, the earning obtained in return is a halal (legitimate, permissible) earning. Even if the time of a worker is spent in vain without working during the working hours and the time in which he/she is at work for the reasons that do not result from him/her, his/her earning is halal/permissible, like those of the public servants or factory workers.
Fee was not specified through any ayah (verse) by Allah. The fee for a person is determined according to the nature of the job, the risk factor at work, whether the employee is qualified and local and economical conditions as well as complying with the justice and fairness, in the amount that it will fulfill the compulsory expenditures of the employee for the comfortable living of himself/herself and his/her dependants, through the mutual agreement of the employer and the employee under the superintendence of the public authority. In this case, following ayat (verses) are taken into account.
Surah At-Talaq / 6 :
6Lodge those women in a part of your home according to your capacity and do not do anything to oppress them which may harm them and you. If they are pregnant, spend on them/provide sustenance until they deliver their burden. Then if they breastfeed for you, give them their payment and confer among yourselves in a way that is acceptable for all. And if you are in discord, then another woman will breastfeed whose payment will be upon the father.
SurahAl-Qasas 25- 27 :
25Then one of two women shyly came to Moses. She said: “Indeed my father invites you so that he may pay you for having watered”. Moses came to her father and told him the story. Her father said: “Do not fear, you are safe from that people who did wrong; acted against their own good by associating others with Allah”.
26One of his two daughters said: “O my father! Hire him. He surely is the best and the most powerful and the most trustworthy of those who can be hired”.
27And father of the women said: “I wish to wed you with one of my two daughters on the condition that you work for me for eight years in which hajj [pilgrimage] is fulfilled. But if you complete it to ten, then it is from you; I would not wish to give you any difficulty. If Allah wills, you will find me from among the righteous”.
SurahAn-Nahl 90 :
90Indeed, Allah commands justice, doing good deeds and giving to people; traveling paupers –who have been expelled out of their homes and deprived of their wealth while seeking for the gifts and acceptance of Allah, and they help Allah and His messenger. He forbids immorality, evil deeds and transgression. He reminds you so you may reason and take lessons.
Surah Al-A’raf / 85-87 :
85-87Surely We sent to Midian their brother Shu’ayb (Jethro) as a messenger. He said: “O my people! Worship Allah, no deity is for you but Allah. There came a clear evidence from your Rabb: Do the weighing and measuring accurately, do not deprive people from their due rights, do not cause corruption on the earth after being corrected; if you are those who believe, this is better for you! Do not sit on every path, threatening, averting the believers from the path of Allah and seeking the deviation of that path. Remember you were few but He made you many. And see how was the end of the corrupters! And if a group among you has believed in that which was sent with me and a group has not believed, then be patient until Allah judges between us. And He is the best of those who judge”.
According to the historical documents, the Prophet has conducted the applications in the manner that the worker would conveniently make a living, acquire a house through savings, get married and provide a vehicle. He reprimanded any excess or shortage from these measures. A living standard was determined here. Muslims must take these measures into account in their whereabouts.
The word of “Riba” means “increase, multiplication, bloating” (Lisan-ul Arab; 4/ 54-56, rbv art.)
The word of “riba” in Arabic means “faiz(interest)” in Turkish and it is also used as a law term with the meaning of “unreturned excess” that is considered to be the entitlement of one of the parties in the exchange contracts and stipulated as a condition during entering into an agreement. That is to say, riba covers not only the increase, multiplication and bloating in monetary businesses but also the increase, multiplication and bloating in the transactions regarding swapping of commodities (detail regarding the issue is given in “Tebyinu’l Qur’an [Manifestation of the Qur’an]” and the articles on our website).
Profit is the “A margin added to the purchase price or cost of goods when selling them, proliferation in trade”. That is to say, profit is the result of exchanging goods. Its meaning in Arabic is “Ribh” and takes place in the Qur’an in Surah Al-Baqara 16, with the expression of: “They are the ones who have purchased going astray for the righteous path so their business has brought no profit and they have not been the ones who followed the righteous path that they were guided”.
Without profit, there can be no economical life in question. Hence, our Rabb ordered in Surah Al-Baqara 275 as follows: “….But Allah made trade halal/permissible but the riba [income that is earned easily without risk, working and effort] haram/forbidden …”
Trade and exchanging goods are done in order to obtain profits or fulfill a requirement. As trade is legitimate, profit is naturally legitimate too; it is not forbidden.
The religion of Islam did not stipulate a standard profit limit in a particular ratio and left it for the designation through the natural conditions and moral measures. Profit limits generally take place automatically in line with the rules of supply and demand and within the free competition principles. However, in order to safeguard this principle and prevent the abuse of basic needs; some precautions were stipulated. Prohibition of riba,[income that is earned easily without risk, working and effort] closure of the ways of unfair/unreturned benefits and application of lowest price fixing when necessary can be listed among such precautions.
Our Rabb has given the following warnings in this regard:
SurahAn-Nisa 29 :
29O you who have believed! Do not consume one another’s wealth among yourselves unjustly -except for business you make with your consent-, do not kill yourselves. Indeed, Allah is very merciful to you.
Surah Al-An’am 150- 153 :
150Say: “Now, bring your witnesses who will testify that Allah has absolutely forbidden this”. If they testify despite this, do not testify with them. And do not follow the vain, transitory desires of those who deny My Ayat and who do not believe in Akhirat [Afterlife]. And they equate with their Rabb.
151Say: “Come, I will recite you what your Rabb has tabooed; made untouchable to you”.
‘Notto associate anything with Him,
to do good to mother and father – treat them good,
not to kill your children out of poverty/being made poor, -We provide for you and them.-
not to approach apparent and concealed of evil,
not to kill a soul which Allah has forbidden except by right, -These are what He brought upon you as a liability so you may use your reason.-
152And do not approach orphan’s property, -But until he reaches the age that he is able to distinguish between good and evil, you can approach in a way which is best and spend in the appropriate way.-,
weight in justice and equity and give full measure, -We never burden anyone other than what he is able to; other than what is within his capacity.-
be just when you speak even if it is against someone close to you,
and fulfill the covenant of Allah.’ –These are what Allah brought upon you as liabilities so you may be reminded and take lessons.-“
153And surely, this is My path, straight. Follow it right away. And do not follow other paths so it will not take you away from His path. These are what Allah brought upon you as liabilities so you may enter under the guardianship of Allah.
Surah Al-Isra 35 :
35When you measure, measure fully and use a straight weigh. This is better and more proper in consequence/implementation.
Surah Ar-Rahman 7-9 :
7-9And He formed the heavens/universe and raised it and placed the scale/measurement/balance so you may not transgress in scale/measurement/balance. Establish the measure with justice and equity, do not damage the scale/measurement /balance.
Surah Hud 84-86 :
84-86We sent to Median their brother Shu’ayb as a messenger. Shu’ayb said: “O my people! Worship Allah. There is no other deity but Him for you. Do not decrease from the measure and the scale. Indeed, I see you in prosperity. And I fear the punishment of a day that will encompass for you. O my people! Establish justice when you measure and weigh. Do not deprive things of the people and do not commit abuse on the earth as corrupters. If you are believers, what remains from Allah/what He bestows you as benefit is better for you. And I am not a protector over you”.
Surah Al-Mutaffifin 1-3 :
1-3Woe to those frauds who measure fully when they purchase from the people for themselves but measure less when they measure or weight!
Through these ayat, objective was set to create sturdy commercial morality and lying, cheating, deception, covering up the defect of a sod commodity or praising it with the non-existing qualities were prohibited and express, realistic and reasonable measures were developed.
Despite them, required precautions to be taken by the public authority as the abandonment of the merchants uncontrolled could cause abuse and exploitation of needs are within the scope of the directives of Allah.
Rent is the ”return of utilizing something that can be utilized (land, plot, building, workplace) for a particular period”. And this return is directly proportional with the utilization. The rent of a land that yields prolific crops is more than the land that is infertile. The rent of a place of business that highly productive is more than the less productive one. The rent of a dwelling promising to live under better conditions is higher than an ordinary dwelling.
According to the economists, the reason for rent is dearth. That is to say, persons are unable to acquire an abode, land, residence and workplace in their locale as they are controlled by speculators or to have the means to purchase the rental object.
“Kenz” means “Treasure, riches, valuable goods remained hidden underground; money or gold” in the dictionary.
As a term, it means: “All kinds of mandatory needs (havaic al-asliyah) surplus values, money, gold, silver, foreign currency, commodities and properties that are not included in the production, employment and trade and kept under cushions and safes.
Mandatory Needs (Havaic al-asliyah):
Havaic al-asliyah means the “financial possibility that will provide one year subsistence of a person after the house where he/she will dwell throughout life, the furniture of that house, winter and summer clothes, and paraphernalia required for his/her working ambiance as well as after the procurement of the vehicle and compensation of debts.” The vehicle and the dwelling must be in moderate value and in the measures that would not pose luxury.
Our Rabb ordered that the surplus of all the values that need to be in circulation is to be provided as infaq/aid and warned that those who commit ”kenz” and fail to provide infaq/aid will be punished in the world and in the Akhirat (Afterlife).
Surah Al-Baqara 195 :
195And spend your wealth for the cause of Allah/provide sustenance for your relatives first and then others, do not put yourselves in danger with your own hands and do good deeds. Indeed, Allah likes those who do good deeds.
Surah At-Tawbah 34-35 :
34O you who have believed! Surely, many of the rabbis/scholars and priests consume the wealth of the people unjustly and avert them from the path of Allah. And as for those who hoard gold and silver and do not spend them for the cause of Allah/provide sustenance first for their relatives and then others, give them the tidings of a painful punishment immediately!
35On that day, gold and silver that they have been hoarding will be heated in the fire of Jahannah [Hell] and their foreheads, flanks and backs will be seared with them: “This is that which you have hoarded for yourselves. Now taste that which you have been hoarding!”.
Surah Al-Baqara 219-220 :
219,220They ask you about that which confuses, intoxicates the mind/causes intoxication of the mind and the games of chance. Say: “In them is great sin yet some benefits for the people. But in the world and in Akhirat [Afterlife], their sin is greater than their benefits”. And they ask you what they should spend for the cause of Allah. Say: “Spend the excess”. Thus Allah makes clear His Ayat for you so you may give thought. They ask you about the orphans as well. Say: “For them ‘improvement’ is the best. If you mix with them, then they are your brothers. Allah knows the corrupter from the amender. If Allah had willed, He would have put you in difficulty. Surely, Allah is the One Who is the most exalted, the most powerful, the most honorable, the invincible/the subduer, the best law maker, the One Who precludes corruption best/makes incorruptible.
Some asserted that stocking the goods for which zaqah/tax has been given will not be “kenz”. This idea is, as can be understood from Surah Al-Baqara 177 manifestly, not an accurate view.
Surah Al-Baqara 177 :
177It is not “being righteous” to turn your faces to east and west. But, “the righteous people” are the ones who believe in Allah, the day of Akhirat [Afterlife]/the Last Day, angels, the Book, prophets; who give their wealth to relatives, orphans, needy, travelers and paupers and the ones who do not have freedom even though they love wealth and who give their wealth by loving Allah and who establish Salah [establish and maintain the institutions that support financially and spiritually; enlighten the community], who give zaqah/tax. And they are the ones who fulfill their promise when they promise and who have patience in the times of hardship, illness and war. They are the ones who are true. And they are the ones who have entered under the guardianship of Allah.
As seen, in this ayah (shown underlined) spending of zaqah/tax and goods; infaq/aid took place separately. While Muslims need food, employment and procurement, it is not Muslim-like attitude to save wealth through gold, silver, foreign currency and cash as well as second and third homes, vacation homes leaving the values that must be in circulation inactive. Muslims may, instead of “Takathur (race of adding more and more, piling up, multiplying)” turning the world into hell together with the persons belonging to the religion of capitalism; work a lot and race in giving charities whereby turn the world into heavens and be one of the “muqarrabun” in the Akhirat[Afterlife].
Surah Saba 37 :
37And it is not your wealth and your children that will bring you closer to Us. But whoever believes and does amendatory deeds, it is those for whom will be many times more recompenses for what they did. And they will be safe in their upper mansions.
Surah Al-Mu’minun 56-62 :
55,56Do they think that We bestow upon them of the wealth and sons so We may hasten them in good deeds? Rather, they are not able to perceive.
57-61Surely, those who shake, fearing to be away from their Rabb for the deep admiration and respect to Him, those who believe in the Ayat of their Rabb, those who do not associate others with their Rabb, those who give what they give while their hearts are in awe for they will return to their Rabb; they are the ones who hasten in good deeds and who go ahead for good deeds.
62And We do not burden any one other than what he is able to; other than what is within his capacity. And with Us is a book that speaks the truth and they will not be treated unjustly.
Surah Muhammad 36-38 :
36Surely, this simple life in the world is only diversion and amusement. If you believe and enter under the guardianship of Allah, Allah will give you your rewards, will not ask you for your wealth.
37If Allah asked you for your wealth and forced you for that, you would withhold. And He would expose your hatred.
38So, you are the ones who are invited to spend for the cause of Allah. Despite this, some of you withhold. And whoever withholds, only withholds from his own self. And Allah is free of need, you are the needy. If you turn away, Allah will replace you with another people. And they will not be the likes of you.
Surah Al-Hadid 7-11 :
7Believe in Allah and His Messenger. Spend from that which He has made you possessors for the cause of Allah/provide sustenance first for your relatives and then others. And as for those from among you who believe and spend; there will be a great reward for them.
8And what is it with you that you do not believe in Allah while the Messenger has invited you to believe in your Rabb? But, He has taken a ‘solemn covenant’ from you that you would believe –if you are the believers-.
9Allah is the One Who has revealed explicit Ayat to His servant to bring you out from all darkness into the light. And surely, Allah is very compassionate, very merciful to you.
10Why do you not spend for the cause of Allah although the heritage of the heavens/universe and the earth belongs to Allah? Not equal are those from among you who spent before the conquest and fought. They are greater in degree than those who spent and fought for the cause of Allah afterwards. Yet, Allah has promised all of them “the best”. And Allah is aware of what you do.
11Who is the one who will loan Allah a good loan so He may multiply for him many times! And a noble reward will be for him as well.
DIFFERENCE BETWEEN INTEREST AND PROFIT
In order to see the differences between trade profit and the transactions that cause riba[income that is earned easily without risk, working and effort], it is sufficient to view the stages of both activities roughly:
On the first stage, the person who plans to obtain gains by means of trading first owns the goods by purchasing them. The person who plans to obtain gains from the transactions that cause riba[income that is earned easily without risk, working and effort] seeks for another person in need in order to lend the commodity or money he/she owns or waits for the needing person to find him/her.
On the second stage, the person who plans to obtain gains by means of trading adds the profit he/she contemplates to obtain to the purchase price of the commodity he/she owns and determines a sales price. In this profit, there are the expenses made since the purchase of the commodity and the fee estimated by the person in return of the service he/she provides. The person who plans to obtain gains from the transactions that cause riba[income that is earned easily without risk, working and effort] has neither expenditure that will be the source for the transactions of riba[income that is earned easily without risk, working and effort] that he/she determined nor a service that he/she would quote for. He/she only notifies the amount of the riba together with those who gain profits along with him/her to the person who asks for the amount of riba.
On the third stage, the person who plans to obtain gains by means of trading is obliged to sell his/her commodity not upon the prices he/she determined but upon the price that occurs on the market outside of his/her will. The person who plans to obtain gains from the transactions that cause riba[income that is earned easily without risk, working and effort] draws up his/her agreement upon the amount of riba he/she determines.
As it is seen, the person who plans to earn by trading and the person who plans to earn from the transactions that cause riba[income that is earned easily without risk, working and effort] experience the above stages by acting differently and obtain different results:
The person who plans to earn by trading receives the respective commodity from the producer and delivers to the consumer through the legal processes he/she carries out with two actions. The profit determined by this person is the return of the service he/she provides but not a guarantee; is under risk.
The person who plans to earn from the transactions that cause riba[income that is earned easily without risk, working and effort] continues to receive the excess he/she determines throughout the term, by means of entering into agreements and through the legal process he/she carries out without actions and without any return from any expenditure or service. His/her risk is inability of the borrower to pay the loan and this action has been probably considered beforehand and the risk has been eliminated by way of pledge or a guarantor.
These very important differences between trading and the actions that cause riba[income that is earned easily without risk, working and effort] apply not only in the commercial field but in all the production activities by exhibiting labor in the sectors of industry and agriculture. That is to say, the profit obtained from the sale of a production carried out through exhibiting manual and mental power and the excess obtained upon the wealth and labor of the debtor by means of lending cannot be considered same.
If an attempt to tell the differences stated above in one sentence is made, it is possible to say this: The labor in trading, industry and agriculture is “constructive” and the profit obtained in return of labor is halal/permissible but the excess obtained as a result of the transactions that cause riba[income that is earned easily without risk, working and effort] are “destructive” and the profit obtained this way is haram/forbidden.
With this comparison in mind, it is possible to say the following regarding the characteristics of riba[income that is earned easily without risk, working and effort] which was prohibited: the “riba”prohibited by our Rabb is the riba obtained not being the return of any cost or service; the riba which means partnering with the earnings of the payer without any risk. In other words, our Rabb has prohibited the “surplus” that is “unreturned” and “riskless”.
When it comes to the effects of interest, number one element of “riba”, on the individuals; it is possible to say that it really poses deadly impact on people in spiritual terms:
Interest constraints people from working. It is because the people with money will earn more easily by depositing it for interest without laboring and taking risk, they may not need to work. This condition causes social mobility to fall and productivity to decrease. The person who receives debts works and earns but a person who receives interest from the earnings of such person is fed without working. However, increase of the wealth of a country can only be possible by working and producing more and more in every field. In some, lesser labor will bring lesser labor.
Interest eliminates helping and solidarity in societies. Earnings easily acquired and without risk, like interest, generally push humans toward selfishness. Hence, those people who have savings can help others prefer to deposit their money for interest instead of giving their money to their brothers and sisters who are in need. For unblocking the road to “helping people in need” ordered by Allah, it is required that interest is rejected and the earnings obtained this way are not relied on.
Interest makes the rich richer and the poor poorer. Except for those who make speculative investments in the long-term inflation periods with high rates, it is not possible to see anyone who receives loans and pays interest to be rich, because the ratios of interest are determined by those people who have money and these people determine the ratios of interest in the manner that they will themselves have the lion’s share pro rata the earnings ratios allowed by the economical environment. That is to say, ratios of interest always correspond to the bigger part of the average unearned income that can be obtained in that environment. Thus the investor who receives loans with interest is allowed not to be reach but only to be continue his/her life; in other words, to sustain indebtedness. If the debtor is not an investor but a person in need, a poor person, it is already clear that such person will be poorer and poorer by means of paying interest. Therefore, interest makes the rich richer and the poor poorer as it is the cause of and maintains the ambiance where a small minority lives in wealth and the majority lives in poverty in a society. Moreover, it is inevitable that such order would gradually turn to be a hell for the low earning group that constitutes the majority of the order because the interest-seeking wealthy ones in these societies become more and more anxious about their lives and wealths as they get richer and richer and apply more diverse ways of cruelty in order to safeguard them.
Interest prevents a servant of Allah to thank and makes him/her ungrateful toward Allah. The wealthy people who are rendered people with surplus by Allah must be grateful to Allah by paying the equivalent of their surplus by way of zaqah/tax, sadaqa and infaq/aid. But the person attracted by interest, which is an easy and riskless gain, tends to interest instead of transferring the return of the blessings given by Allah to the addresses designated by Allah and fails to carry out his/her duties by being entrapped. Knowing that the possibility that man can easily be entrapped this way is very high, as He is the Rabb of him, says in the Ayah 276 of the Surah Al-Baqara, “Allah removes the riba [income that is earned easily without risk, working and effort] and increases the sadaqa/public revenue. Allah does not like those who are ungrateful and sinner” promising that riba[income that is earned easily without risk, working and effort], which also covers interest, will not bring any good to any person, because the sadaqa and infaq/aid will be returned more and more in the world and in the Akhirat [Afterlife], along with His threat that He would destroy it, and reminding once again the fact that humans must prefer thankfulness instead of ungratefulness. What is satated in the Qur’an as “Adam’s tasting from the tree for which Allah said ‘do not approach’ and his immediate starting of stowing” figuratively is actually this issue.
As it is seen, interest, starting with the psychologies of persons, alters their work lives and subsistence and causes their family order to overturn. Gradual increase of such individuals in the society brings closer that society toward danger and drags the country containing such society having turned to be the slaves of interest toward colonization, the fire, as in the Ottoman example above, as a result of consuming its underground and aboveground wealth.
In sum, interest, in regards to its outcomes, is one of the biggest factors that render the poor slaves and the countries colonies.
However, “riba”[income that is earned easily without risk, working and effort] cannot be downscaled to interest because, as we stated above, our Rabb has not prohibited interest but “unreturned” and “riskless” surplus. Therefore, Muslims must not be socially deviant for self-delusion like staying away only from interest and consuming other unreturned excesses that fell into the scope of “riba”. However, unfortunately people found “riba” indispensable and those who did not want to leave this sweet earning made themselves believe that what they did was not within the scope of the “riba” prohibited by Allah, by means of reducing the concept of “riba” into the concept of interest and of excluding the “riba” they earned from the nature of interest through the implementations called muamalat al shariah.
DIFFERENCE BETWEEN INTEREST, KENZ AND RENT
As there was no scarcity of land and building as well as of material pro rata population in the period during which the Qur’an was sent down, there was no manifest ayat in regards to ”Rent”. Thus, this issue is studied within the framework of the other provisions specified in the Qur’an.
Some alleged that “rent” and “riba” [income that is earned easily without risk, working and effort] are not the same things and that there are some differences in between in terms of both process and revenues and developed examples as follows:
— In rent, the proprietor of the property does not disconnect its relation from the property once he/she lets it out on hire. He/she is interested in both the utilization of the property by the tenant and the condition of the property. In interest, the person who lends the money is not interested in the manner of using the money. What is important is the receipt the principal sum and its interest without interruption.
— In the case of rent, if it is not possible to use the rental property and to fulfill the objective of renting it as a result of a malfunction, the proprietor is obliged to repair and rectify the defect. In this case, although the rental object is in the hands of the tenant, he/she would not pay the rental fee during the idle period. In the case of money received through interest, the debtor always pays the interest regardless of whether he/she utilizes the money or not.
— In rent, the title, size and benefits of the rental property is determined by the proprietor. That is to say, the control of the rental property is in the hands of the owner. Therefore, the area and purpose of using the property is certain. This is not the case when it comes to interest. The control of the money received with interest is in the borrower. The area, manner and purpose of use of the money do not concern the owner of the principal amount. Hence, it is possible to abuse capitals.
—Payments made in return of rental fee are considered to be expenditures being paid from the revenues and not included in the price of costs in the production. Interest financing costs are added to the production cost. This cost is reflected to the consumer. This way, it is to the detriment of the consumers, generally the poor.
— In the case of rent, there is the possibility of incurring losses in addition to the probability of profits. This condition, the use of capital in the businesses that yield rental income, does not create a class of idle people who waste their time. In interest, there is no possibility for losses. The person who gives the money with interest guarantees his/her money through the ways like hypothec, guarantors etc. This features an idle and parasite class of people who waste their times in the society.
—In the case of rent, the tenant pays back the return of the benefit obtained from the rental object, dwells in the house, produces at work and farms on the land. In the case of interest, no direct utilization of the received money is in question. The money is not eaten, drunk or dwelled in etc. However, in the event that the money is used in trade or production, then there is the utilization of that money. But, it is still not guaranteed to provide profit or benefits in trade or production. In the case of interest, the profit and the amount of the profit are guaranteed in advance.
—The rental properties do not become more and more valuable at all times; they are even subject to wear and tear. Accordingly, rent is the return of depreciation as well. However, in the money lent for interest, no depreciation, decaying and getting older is in question. In an environment without inflation, there is no difference between the old money and new money in terms of purchase power. That is to say, the new money and the old money have the same value.
However, the theses asserted above do not fully accord with the realities of life:
— Lenders, just like landlords, do not risk their money by tracing the condition of the borrower in every and all respects and ask the credits they provide to be given back in any case of discrepancy.
— Even though the damages on the rental property not stemming from the tenant are paid back by the property owner, no condition of not paying the rental fee during the troubleshooting period is in question in practice. For example, it is not possible to see an application of not asking of rental fee during the repair of the roof of a store whose roof is leaking by the owner, in the real life.
— Even if the manner of using the rental property is predetermined, it is not possible to prevent the tenant from conducting other illegal businesses in that workplace subsequently. Or, if the tenant is a malevolent person, he/she may conduct some activities without the knowledge of the owner. On the other hand, it is possible to conduct quite benevolent businesses like constructing a school with the money received through interest.
— The allegation that the rental revenues are not added to the production cost is never in line with realities because the rental expenditures are added to the costs just like the interest expenditures and reflected into the sales price of the goods or services.
— The fact that the person whose property is rented incurs loss due to such transaction is a thing that has never been encountered in practice. Occurrence of loss from the rental transaction for the owner can only be possible if the rental fee is not paid and this condition is already guaranteed through the preliminary received deposits and trustees and loss incurred by the proprietor is prevented this way. On the other hand, the idea that the rental transaction will not create an idle class is not realistic either, because the number of the people who live idly through the rental revenues of the real estate properties they have is never a little.
— The allegation that the money will not be subject to losses in the course of time is an exact fantasy because it is an indispensable truth that money is devalued through inflation even in the most developed economies. In addition, the possibility that the property of the owner can gain extremely high value for the reasons like the modification of the zoning plan or the direction of urban development invalidates the allegation that the property is subject to devaluation through depreciation in the course of time.
In summary, the allegations such as above that are not harmonious with real life do not eliminate the reality that “Earnings provided by rental property, land or commodity as well as interest are revenue provided by capital that has the potential of converting into goods or assets. The person who rents his/her property obtains revenues without labor as of the date of renting. Hence, they are not different from each other.”
Therefore, acquisition of surplus houses, lands, workplaces etc. and obtainment of rental fee from them clearly emit the smell of Kenz and Riba[income that is earned easily without risk, working and effort].
The religion of capitalism is an economic order that dominates substantial majority of the world today. This religion is based on the principle of “the big fish eats the little one”. Therefore the religion of capitalism is exactly the opposite the religion of Islam in terms of both morality and consciousness. Despite this fact the persons who allege that they are Muslims endeavor to find a place within the principles of capitalism, instead of creating the system and institutions wanted by Allah, which indeed is an embarrassing behavior. The behavior that befits Muslims is to constitute an economic system that is suitable for the lifestyle recommended by Allah but, first to exclude “riba” to get rid of the position of being “the enemy of Allah and His messenger”.
Our Rabb did not withhold His blessings as well, as in every subject, and showed the ways of creating the system and institutions for salvation, by not letting people search and find what the families and the countries are to do to get rid of the calamity, the trouble of “riba” and “kenz” manifestly in the Qur’an (Surah Al-Ma’idah 12, Surah At-Taghabun 17, 18, Surah At-Tawbah 34, 35, Surah Al-Baqara 45, 46, 153, 195, 219, 245, Surah Hadid 11, Surah Al-Ma’idah 2, 48, Surah Ali-Imran; 103, 104 Surah Al-Asr 1-3, Surah Al-Ankabut 45, Surah Mary 59-61, Surah Fatir 6, Surah Al-A’la 14-17).
The Ayat given above are some of the hundreds of Ayat that orders sustaining of Salah[Support financially and spiritually; establish and maintain institutions that enlighten the community], Zaqah/tax, and Sadaqa, some of the ways of getting rid of “riba” and “kenz”. With these Ayat, our Rabb orders the believers of Islam to get organized and create unions, to spend their surplus for the sake of Allah and race in doing good deeds and favors by creating the social support and infaq/aid organizations and expressly states that those people who fail to do so will pose sorrow and danger to their societies and live life of hell in the world and that those people who commit ”kenz” (people who do not bring their moneys out for circulation by keeping them in cubes, under cushions, in safes and banks) will be punished. Hence, the solution for the persons, families and countries to get rid of the trouble of “riba” and “kenz” is to conduct deeds through these Ayat and to carry out the tasks ordered by Allah with these Ayat.
For example, Muslims can bring together their surpluses granted by Allah to them in the light of these Ayat instead of depositing them for speculative investments and interests. They may establish partnerships where audits are carried out by the public authority and no abuse is done. By conducting trade whose legitimacy is unquestionable in the religion of Islam or by establishing a Mudarabah/Muqarazah partnership (A Labor-capital partnership crated, with one party providing capital and the other employment), they might attempt to provide production, employment and profits.
This way, these people will will create new job possibilities for the unemployed and ensure that money in their hands will bring benefit to others as well. Later on, they may establish social aid and support institutions as well as charities oriented to infaq through the gains obtained from such partnerships and lend money to those Muslims who are in need thanks to such organizations without interest (qarz-ı hasen). Of course, in the lending done from such social aid organizations, if the borrower is really unable to pay back his/her debt, it must be possible to erase the debt and even to provide more monetary reinforcement to the borrower as required by the recommendation of Allah. Also from these charities, the short-term requirements of the tradesmen must be fulfilled and accordingly prevent the Muslims from entering into the grip of the banks and usurers. In the event that there still is idle money in these charities, new companies can be founded in legitimate ways using these forms and new more charity organizations by means of the revenues obtained from the activities of these companies and it can be ensured that this productive circulation continues by growing.
However, in order to make sure that such system can be operable, actions must be taken first in the family circles and the establishment of the system must be realized by growing along the neighborhood, village and province because success can, as ordered by our Rabb, only be obtained through the self-correction of persons one by one.
In such as system, neither interest, nor stock exchanges, not another form of “riba”[income that is earned easily without risk, working and effort] is needed; more accurately, no type of “riba” will be required because the public authority has to establish institutions that can carry out the works such as collection of surpluses in the hand of the public and present them for the utilization of the partnerships that will make use of them in their investments, for the continuation of such economic order, without any interest. These institutions will not only be able to carry out the works done by the banks and stock exchanges of the capitalist system on behalf of people but also fulfill the transactions of the traders and people such as collection of checks and deeds and remittances not within the order of theft, just like that of the banks of today, but in return of respective charges, or free of charge if no such charge is applied.
We have stated above that the reason for renting is famine. The religion of Islam brought principles that eliminate “famine”. There is no famine in the areas where the principles of Islam are applied. The religion of Islam has eliminated the reasons of famine. Some of them are:
- The religion of Islam has forbidden the circulation of wealth among the wealthy people as a means of power and prevented the creation of speculators and cartels within the society.
Surah Al-Hashr 7, 8 :
7,8And the Fai [revenues yielded without fighting and making any effort] Allah has given to His Messenger from the people of that city belong to Allah, the Messenger, those poor who have immigrated – and they have been expelled out of their lands and deprived of their wealth while seeking for the bounty and acceptance of Allah, and they help Allah and His Messenger. They are the ones who are the righteous-, orphans, the needy and travelers so the luxury brought by the power; the authority will not only be for the rich among you. Whatever the Messenger has given you, take it immediately. And whatever he has forbidden you, turn away from it. And enter under the guardianship of Allah. Indeed, Allah is the One Whose punishment/penalty is very severe.
In hundreds of ayat, salah [Support financially and spiritually; establish and maintain institutions that enlighten the community], substitution of salah, zaqah/tax, infaq/aid and sadaqa were ordered and it was stipulated that they are to be used to provide equal work, food, education and training to everyone by means of using them. The Muslims will create sufficient workplaces, educational institutions and social support institutions, thus will not suffer from famine to have land, plot, residences.
Surah At-Tawbah 60 :
60Truly, as an allocation/an obligation from Allah, the sadaqa/public revenues are only for the poor, the needy/the unemployed, the officials who work for that matter/public servants, those whose hearts to be encouraged to Islam, unfree slaves, those in heavy debt, those in the path of Allah [soldiers, students and teachers] and the stranded travelers. Allah is the One Who knows all best, the One Who is the best law maker.
In addition to this ayah, hundreds of Salah [Support financially and spiritually; establish and maintain institutions that enlighten the community], infaq/aid, and zaqah/tax ayat must be taken into account.
The religion of Islam prevented people from piling up in particular settlements and stipulated that Allah’s world is vast and that they can create settlements in suitable areas not to cause famine but to get rid of it.
Surah Al-Baqara 60 :
60And when Moses asked for water for his people and We said to him: “Implement your experience upon your stonehearted people!”. Then, twelve groups/people of cities were divided into many directions from his stonehearted people. The people of each city learned/marked where they would obtain their water. –Eat and drink from the provision of Allah and do not transgress on the earth by causing corruption.-
Allah knows the truth best.