Riba, which translates to “usury” or “interest,” is a significant concept in Islamic finance that refers to the prohibition of charging or paying interest on loans. Avoiding riba is a crucial aspect of ethical and responsible financial practices in Islam.
The prohibition of riba is rooted in the belief that it creates an unjust and exploitative system, leading to wealth inequality and social imbalances. It is also seen as a form of oppression, as it allows lenders to profit excessively from the financial needs of borrowers.
