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Is Usury On Business Loan Haram?
From the explanation of Ghamidi Sahib, why interest on personal loans is haram because the person has to recreate wealth.
On the other hand, a business loan is not for a compressing reason but to make more money and expand the business. A business man runs his calculations and then decides whether it is worth for him to take loan at certain interest rate. Normally such loan is secured by business assets. This is no different than taking a mortgage to buy a home.
So, please explain why interest on business loan will be haram, if it is haram at all.
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Is Usury On Business Loan Haram?
updated 1 year, 9 months ago
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Pressing need or no need makes no difference in this regards.
Business loan, is in fact investment of Bank with the customer, when it is secured by some assets, it is mortgage too, so here two matters are joined, and both are fine. It is in fact Principal secured investment with fixed profit. So it is allowed and halal matter. the only objectionable thing in it is that if the business fails, the bank should demand only the principal amount. Its insistence on taking the profit or increase, is Zulm.
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