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The basic principle to be followed in financial deals and business as laid down by the Holy Qur’an is that there must not be any exploitation of the needy by the lender or the seller. Exploitation of others is considered to be a most heinous crime against society. Muslims are enjoined to take up the cudgels if exploitation is noticed anywhere. Allah promises hellfire for whosoever indulges in this practice. This is the basic reason that RIBA (Usury –Interest) is strictly prohibited, as it involves the exploitation of the needy.
The second principle governing economy in a Muslim society is that money and resources should flow from the rich to the poor, from haves to have-nots. Keeping this principle in view, it is ordained that every affluent individual must contribute a certain percentage of his wealth annually to alleviate poverty and to help the needy. This obligatory due is called Zakat and is leviable on holdings, and merchandise etc., which are surplus to one’s normal needs of one year. Zakat can be collected by the Government and be used on poverty alleviation or it may be distributed by the individuals to the needy, starting from their close relatives or immediate neighbours and spread out to other people. Similarly, a cess ‘Usher’ is charged on agricultural produce.
The Zakat and Usher money is one of the primary financing source of an Islamic state. It can give great impetus to socio-economic development, if utilized in an organized manner, thus alleviating poverty and bridging the gap between the poor and the rich. If need be the state can levy additional taxes for funding the administrative services, public utilities as well as development and defence needs.
In case someone needs financial loan to set up a business, small or big, or set up an industrial project, the lender cannot charge a fixed interest on the loan but has to be a partner in the venture on profit and loss sharing basis. This system has been introduced so that the party that already has short or no resources should not completely collapse in case of loss in business, while the one that is already affluent and has surplus resources to lend money to others, would get his fixed charge in any case. Thus, the society has to develop not by exploitation but through hard and honest work. Profit-loss sharing between the partners in any business or industrial or agricultural venture is the hallmark of dealings between the affluent section of society and the one that lacks resources for its sustenance. It leads towards more equitable distribution of wealth. It encourages the wider utilization of experience and expertise of people who have learnt some trades but do not have enough resources for its utilization. Such experienced persons can form partnerships with those who have the money but no skills. It would be observed that if this policy for money management is applied in letter and spirit, the whole society would flourish and the country would develop rapidly. |
