Difference between Islamic banking vs Interest banking
- Thread starter uzair_nadeem99
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- islamic banking
Urdu speaking
Minister (2k+ posts)
Soud term is only implied on consumables thing not on useable thing like any solid material like property etc not in cash liquidity, cash liquidity loans are all soud if any extra money asking back
Vitamin_C
Chief Minister (5k+ posts)
Money is not consumed its exchanged for an item or service of equal value. Its an asset just like a house or a delivery truck, albeit a more liquid one. But liquidity gives it more value.
Even if it is a consumable that makes no difference as the other person can keep that money in a bank deposit and return it later just like a rented house. In principle rent and interest is the same thing.
They are charges that make up for the risk and opportunity cost, the lender could have used the land or capital for other purposes but instead he chose to lend. This is why the Islamic system doesn't work, because you cant differentiate the oppertunity cost of labour, land and capital.
Even if it is a consumable that makes no difference as the other person can keep that money in a bank deposit and return it later just like a rented house. In principle rent and interest is the same thing.
They are charges that make up for the risk and opportunity cost, the lender could have used the land or capital for other purposes but instead he chose to lend. This is why the Islamic system doesn't work, because you cant differentiate the oppertunity cost of labour, land and capital.
uzair_nadeem99
Citizen
Those who consume interest cannot stand [on the Day of Resurrection] except as one stands who is being beaten by Satan into insanity. That is because they say, "Trade is [just] like interest." But Allah has permitted trade and has forbidden interest. So whoever has received an admonition from his Lord and desists may have what is past, and his affair rests with Allah . But whoever returns to [dealing in interest or usury] - those are the companions of the Fire; they will abide eternally therein.
https://quran.com/2/275?translations=20
https://quran.com/2/275?translations=20
I have two accounts one in Islamic bank and one in conventional bank since ten years. The only difference I have found is that the Islamic bank always gives less interest (calls it profit) than the conventional bank. Not a single month in last ten years did I find the profit of the Islamic bank more than the fixed interest of the conventional bank.
velayiti rajpoot
MPA (400+ posts)
بہای صاحب آپ جو کہ رہے ہیں وہ دالر کے بارے میںہے جو کہ آزاد کرنسی ہے -ہمارا روپیہ کی قیمت تو ہر روز کم ہو جاتی ہےمین اس ۱۰۰ روپیہ جمعہ کراتا ہون دس دن بعد ڈیویلیو ہوجا تا ہے قیمت ۷۵ ہو جاتی ہے میرا تو اصل زر بہی واپس نہیں ملتا اوپر سے کہتے ہو سود نہ لو- بنک والا تو مجحے لوٹرہا ہے سود لگا کر بحی مجہے کم واپس کرتا ہے- مجہے اس کا حل بتاو اوٹپٹانگ باتیں مت کرو
Liberal 000
Chief Minister (5k+ posts)
If someone rents a shop expecting he will earn and pay the rent. If he fails to earn as per his expectations then the rent is a Sood
Same thing is with land if a farmer fails to earn he still has to pay the landlord
Same with salary, if a firm expecting growth or profit hire people and use their services but if their services fails to benefit or earn profit for the firm, the firm still has to pay the salary which is infact sood
Urdu speaking
Minister (2k+ posts)
بات کو سمجھنے کی کوشش کرو کھوپڑی میں ناریل کا تیل لگا کر ....میں کسی کو پیسہ دیتا ہوں مثال کے طور پر کسی کی بیٹی کی شادی کے لیے تو اس نے وہ پیسہ کنزومڈ کرلیا اب وہ پیسا اگائے گا یعنی کے روزی کما کر وہ قرض کا پیسہ واپس کرے گا اس پر میرا اس سے زر کا مطالبہ یعنی کے مزید پیسے کا مطالبہ کرنا سود کہلائے گا جو کہ ایک ظلم ہوگا اس کو الله نے قرآن میں سود سے تعبیر کیا ہے، نبی کے زمانے میں وہ قبائلی سردار اور اشرفیہ جو کے اسلام قبول کر چکے تھے انہونے لوگوں کو قرضے کے اوپر زر کی ادائگیوں کے عیوض غلامی میں جکڑا ہوا تھا کہ انکا زر کا مطالبہ ختم ہی نہیں ہوتا تھا اور نہ ادھر غلامی تو اس پر الله نے پہلے تو منا فرمایا اور سخت نہ پسندگی کا اظھار فرمایا مگر جب وہ نہ باز آئے تو ان کا یہ عمل کو خدا اور اس کے رسول سے جنگ کے متبادل قرار دیا ، وہ قرضہ جو بینک مکان کے عیوض سینکشن کرتا ہے وہ ایسا ہی ہے جیسا کہ میں نے کہا کے صاحب اس مکان کا کرایہ دس ہزار روپے ہے پر اپ اگر مجھے اس کے اوپر پانچ ہزار مزید بیس سال تک دیں تو یہ مکان بھی اپ کا ہو جائے گا جو کہ ایک جائز بات ہے اور یہی مورگیج پالیسی ہوتی ہے یہ سود کے زمرے میں نہیں اتا اس کو ہائر پرچیز ایگریمنٹ کہا جاتا ہے
The_Choice
Senator (1k+ posts)
The_Choice
Senator (1k+ posts)
atensari
(50k+ posts) بابائے فورم
سود وہ اضافی رقم ہے جو فوری طور پر مطلوبہ نقد رقم نا ہونے پر مستقبل میں ادا کی جاتی ہے. کرایہ جگہ استعمال کرنے کی قیمت ہے اور تنخواہ جسمانی اور ذہنی صلاحیت کا صلہ
Liberal 000
حیرت ہے جو ہر بات میں پوچھتے ہیں قرآن میں کہاں لکھا ہے انہیں یہ نہیں پتا کے الله نے تجارت حلال کی ہے اور سود حرام
Liberal 000
حیرت ہے جو ہر بات میں پوچھتے ہیں قرآن میں کہاں لکھا ہے انہیں یہ نہیں پتا کے الله نے تجارت حلال کی ہے اور سود حرام
Vitamin_C
Chief Minister (5k+ posts)
I perfectly understand what you are saying... However I am not interested in specific scenarios but rather the main principles behind the concepts. Thats how Economics is studied.
There are significant similarities between Wages, Rent & interest that you need to answer to before you start talking about removing interest from capital.
1. Opportunity Cost: When a person rents out his warehouse, he is losing the opportunity to use that warehouse to produce t shirts earning him 10%. Similarly when a person is leading money, he is losing the opportunity to invest it in Goods to be exported to China and earning him 10%.
2. Time value of money... The value of rs100 today is much greater than it will be in 1 year. Rs 100 today is equal to rs110 in one year time. So if you lend someone rs100 it will be unfair for you to receive rs100 after one year.
3. Game theory: Profit sharing only works when the effort of the manager is observable by the owner or the lender... Also the extent of the effect of managers effort on profit is measurable... That is why majority of employee compensation is based on fixed salary rather than % of net profit. The same theory says that if the manager's effort is not observable then renting or interest is the only option.
4. Not all borrowings are meant to generate profit. For example lending to someone for a marriage, or buying govt bonds so govt can invest in public goods such as paving a road and putting up street lights.
5. Even if you say money is more liquid than a house, then loans are often backed by more fixed asset collaterals such as a house, rights to an incoming shipment or some other assets...
6. Risk to Rewards ratio... Individual lenders may act in a irrational way for example lend money to a high risk borrower such as someone borrowing for a marriage that he cannot afford, and puts down no collateral. But most of the investment and lending is done by more sophisticated lenders. These lenders will not lend to a high risk borrower unless promised a higher return, also they will accept lending to a low risk borrower with a lower return. It means that risk/reward of investments is comparable with each other and an intelligent investor will compare many different investments to pick the one with the best risk/reward ratio. With no interest, there will be no incentive for the lender to lend money to a borrower who is in extreme need of money but is slightly riskier.
Because these reasons the Islamic system is not only cruel, its puts both lenders and borrowers at a severe disadvantage.
That being said, not all types on interest are ethical... For example interest should not be excessive, money should not be lent to people who we know will never be able to pay back. There should be a system by which people are forgiven their loans in an unforeseeable event or tragedy.
There are significant similarities between Wages, Rent & interest that you need to answer to before you start talking about removing interest from capital.
1. Opportunity Cost: When a person rents out his warehouse, he is losing the opportunity to use that warehouse to produce t shirts earning him 10%. Similarly when a person is leading money, he is losing the opportunity to invest it in Goods to be exported to China and earning him 10%.
2. Time value of money... The value of rs100 today is much greater than it will be in 1 year. Rs 100 today is equal to rs110 in one year time. So if you lend someone rs100 it will be unfair for you to receive rs100 after one year.
3. Game theory: Profit sharing only works when the effort of the manager is observable by the owner or the lender... Also the extent of the effect of managers effort on profit is measurable... That is why majority of employee compensation is based on fixed salary rather than % of net profit. The same theory says that if the manager's effort is not observable then renting or interest is the only option.
4. Not all borrowings are meant to generate profit. For example lending to someone for a marriage, or buying govt bonds so govt can invest in public goods such as paving a road and putting up street lights.
5. Even if you say money is more liquid than a house, then loans are often backed by more fixed asset collaterals such as a house, rights to an incoming shipment or some other assets...
6. Risk to Rewards ratio... Individual lenders may act in a irrational way for example lend money to a high risk borrower such as someone borrowing for a marriage that he cannot afford, and puts down no collateral. But most of the investment and lending is done by more sophisticated lenders. These lenders will not lend to a high risk borrower unless promised a higher return, also they will accept lending to a low risk borrower with a lower return. It means that risk/reward of investments is comparable with each other and an intelligent investor will compare many different investments to pick the one with the best risk/reward ratio. With no interest, there will be no incentive for the lender to lend money to a borrower who is in extreme need of money but is slightly riskier.
Because these reasons the Islamic system is not only cruel, its puts both lenders and borrowers at a severe disadvantage.
That being said, not all types on interest are ethical... For example interest should not be excessive, money should not be lent to people who we know will never be able to pay back. There should be a system by which people are forgiven their loans in an unforeseeable event or tragedy.
Urdu speaking
Minister (2k+ posts)
Sir jee. Islamic banking is fraud and it wasnt my discussion....my point was about distinction between Soud(Usury )and profit(Mudarabah-based profit)....
Paying interest on loan which is granted from either banking sector or lender for the purpose of buying a machines,land, furniture, car or any thing which is available in form of material is called use able items and its halal as its mark trade deal and the item is present in its actual form. But asking pay back profit or interest on issued personal loan for non use able items is haram as its unethical or immoral because the loan is consumed in liquidity form and the borrower has to generate the money
azeezam uzair nadeem sb, isse pehle ke koi ribaa ki baat kare ye tayun karna zaroori hai deene islam kia hai is ka maqsad kia hai. aakhir ribaa haraam kyun hai? isse hota kia hai or kyun hota hai?
agar ham soch samajh ker quraan ko padhen to pata chale ga insaaniyat aik hi khaandaan hai aur hona bhi chahiye. magar log apne unjaanpan ki wajah se aapas main ladayee jhagda karte aaye hen issi liye khudaa ne un ko paighamaat bhaije anbiyaa ke zariye issi baat ka ehsaas dilaane ke liye aur un ko aik ummat banaane ke liye.
ab sawaal peda hota hai log aik ummat kaise ban sakte hen agar un main ehsaas hi bedaar na ho keh woh aik hi khaandaan hen. kyunkeh log khud ko aik hi khaandaan ka fard tasleem karne ko tayaar nahin hen issi liye woh aik doosre ko neechaa dikhaane main her waqt koshaan rehte hen.
her shakhs ka jahaan tak us ka bas chalta hai doosrun ko dabaane ki koshish karta hai. issi koshish ke nateeje main logoon ne zindagi guzaarne ke kayee tareeqe ijaad ker daale hen jin per woh apne apne agende ke mutaabiq amal peraa hen.
kyunkeh log doosrun ko dabaane ke liye koshaan hen issi liye unhune tarah tarah ke herbe aur hathkande ijaad kiye huwe hen. issi ke nateeje main nizaamen malookiyat wajood main laaya gayaa, issi ke nateeje main nizaamen sarmayadaari wajood main laaya gayaa auir issi ke nateeje main mazhabi peshwaiyat wajood main layee gayee hai.
agar log khud ko aik hi khaandaan ke afraad samajhte to kia un ko aik doosre ko dabaane ki zaroorat thi? agar nahin thi to kia un ko nay nay herbe aur hathkande ijaad kerne ki zaroorat thi jisse woh aik doosre ka jeena haraam ker den?
jab mullaan aur un ke shagird quraan ko is tanaazur main padhen ge to maaloom ho ga ribaa ki drust taareef kia hai quraan ke apne sayaaqo sbaaq main warna mullaan ki bebynuaad baaten qatan deene islam nahin hen. For a detailed explanation of things about the quran and deen of islam see HERE and HERE
regards and all the best.
The_Choice
Senator (1k+ posts)
Dear the choice, learn things properly to avoid spreading nonsense and confusion.
Think about constitution and law, If you will then you will realise constitution is something upon which something is based or built. it provides foundation or foundational structure or framework for building something upon it. In our case it is about building a proper human community in a kingdom based upon guidance of God. To build a human society upon something you need a societal structure or framework ie a constitution. Law is for regulating a human society or community.
A constitution and its related laws need a place of their own wherein they could be acted upon freely by their adherents. If you do not have a place for a constitution and its laws then that constitution and its laws cannot be practised freely and fully. If one tries to instate the islamic constitution and its laws within an already existing society that opposes it then one is in fact trying to create a state within a state. This will start a conflict within the existing society wherein those who are weaker members of society ie muslims will end up in serious painful suffering by hands of the stronger party.
So you cannot practice deen of islam fully and freely in an unislamic society. In that case what is the way forward? It is to spread the message appropriately and leave the rest to the people. If message is strong enough and is spread appropriately and wisely then people will become convinced and adopt it in time to come once they realise its benefits for themselves. Once convinced people become a sizeable majority then they can install deen of islam as their way of life in that place. This is the right way of spreading knowledge about deen of islam. Not the way you and these mullaans you support are carrying on. That is a way to a huge fitna to borrow your words.
Since islamic constitution is not installed anywhere in the world islamic law does not come into operation. I have explained things in detail in links I have provided but people like you are not bothered with learning things the right way. You keep posting your videos without thinking things through thoroughly.
None of these mullaan is talking about stages of implementation of deen of islam from beginning of the mission till its completion. The quran contains instruction for various stages of mission. Learn what they are. Remember within an islamic kingdom that is fully established and fully functional there is no place for malookiyati nizaam, sarmayadari nizaam and nizaamen mullaiyat. All these concepts are foreign to deen of islam. However kingdom of Allah allows muslims to deal with nonmuslim states and poeple appropriately. Just as muslims are allowed to deal with nonmuslims when they are living among them as a minority group of people ie a muslim ummah.
This is why when we read quranic verses we must find out how they apply and at what stage of mission. By applying verses of the quran inappropriately at various stages of mission muslims only bring unnecessary infliction and hardship upon themselves. This is why and how these mullaans are ruining this ummah and people like you are helping them do that for whatever right or wrong reasons you have in your mind. Therefore I wish you learn things appropriately and reconsider your position before it is too late. Please remember I have no personal score to settle with you. I too am trying to explain deen of islam just like you out of sense of duty by our creator. However it is also our duty to tell people what is true and right the right way. By doing things the wrong way we damage the cause we think we are supporting.
regards and all the best.
