Riba is defined simply as ‘usury’ in Lanes lexicon. To understand usury, you must first understand trade, as usury is not trade. To understand trade you must understand ownership, innately you may only own that which you create yourself.
In trade the only thing you then own is your labours, and it is these labours invested in the exchange that are traded.
For example, if I exchange a bag of apples for a bag of potatoes, the apples and the potatoes are free, it is only the labours invested within their cultivation and delivery, that have value in exchange.
Usury is a certain benefit, which is received for the use of the thing lent beyond the return in full of the thing lent, and is not lawful. It is not interest alone; that is simply one expression of the concept of usury.
Consider this definition through the perspective of trade.
Usury is unreciprocated labours, which are received for the use of something lent, beyond the return in full of the thing lent. In others words, trade is an exchange of labours, usury is a taking of labours without reciprocation.
Usury has wide application: it prevents all forms of renting that involves no labour, and the problem is people do not grasp the allodial labour concept. Resources must always remain free, only the added value of your labours can be chargeable.
One of the modern terms used in place of usury is profit, not to be confused with the fruits of your labours, this is not profit. Profit is simply an alternative term for usury; profit is the rent on capital, pecuniary gain resulting from the employment of capital in any transaction, as a term it was dormant until revived in World War I as a noun. Profitable is from early 14c., meaning "yielding benefit”.
For example, if I plant a field of watermelons, the watermelons are the bounty of the Creator, grown from the earth and out of the seed, and from the design of the Creator, but the physical labour you invested in the planting of the seed, the preparing of the land, the harvesting and marketing of the watermelons, is what you have honestly earned and deserve in reward of your labour, so when you sell the watermelon, the watermelon itself is free, as it is the bounty of the Creator, but the labour it took to reach its end user and consumer must be paid by the end user and consumer.
Riba must be understood in conjunction with two other concepts of reciprocation, which is the basis of inherent power (Islam), the first is you cannot hold a monopoly, and second you cannot ‘be’ or ‘use’ a slave.
Slavery is a relation founded in force, not in right, existing, where it does, by force of positive law.
The definition incorporating these three concepts collectively is ‘the theft of the fruits of another’s labours’.
If I have £100,000 and I lend it to my neighbour gaining 10% interest per year on my investment, this agreement is Riba (Usury), as I am gaining the labours of my neighbour from no labours of my own in exchange for the temporary use of my money. So I am receiving more than the full return on the thing lent.
You may argue I have lost the use of the £100,000 and deserve compensation, this is based upon the idea that capital generates wealth, which is a lie, this lie is imposed pragmatically through scarcity of resources established with monopoly and maintained with violence and intimidation. Usury ownership being the basis of this fraud.
The only thing that generates wealth is physical labour, and Riba is taking the labours of others in exchange for no labour yourself, having the effect of stealing the fruits of their labours.
The reciprocal (Islamic) model uses allodial labour as the medium of exchange.
Allodial comes from allōd which means free of any grant, claim, registration; so “unattested”, utilised undivided, completely, unimpaired, free from all shared gains; so utilised in its “entirety”, your labours must always be your own. Slavery is shared gains, if 100% of your labours are owned by another, at what percentage are you no longer a slave, of course only at 0% are you free.
The Quranic view is simple, once the concept of allodial labour is understood, you must receive 100% of the fruits of your labours, no man has the right to lay claim upon part of your labours for himself, an example of that would be taxation, a form of theft based upon a section of mankind acting as lice on the body of the people draining their lifeblood, to exist without their efforts matching their benefits.
Interest comes from the Latin verb "intereo" meaning ‘to be lost’.
The ancient Israelites called usury "a bite". It is like the slow poison of a serpent:
"Usury does not all at once destroys a man or nation with, as it were, a bloody gulp. Rather, it slowly, sometimes nearly imperceptibly, subverts the victim's constitution until he cannot prevent the fatal consequences even though he knows what is coming."
Riba - (Ra-Ba-Wao).
Raba - Yarbo is to grow, to become bigger or to get swollen. "Le Yarbo fi Amwallinnas" means that a person's own wealth may grow with people's wealth (Qur'an 30:39). Means the growth of vegetable (22/5). Ar-Baa are the affluent, abundantly rich (Taj / Moheet). Rabwa means raised portion of the ground (23/50). Ar-Riba is the interest that is taken on loan to charge more on the capital (Raghib). It occurs in the Quran 7 times, 5 times in Surah Al-Baqarah, once in 'Ale-'Imran and once in An-Nisa.
The most important and fundamental system in the Quran is its economic system. It forbids Riba totally, whether it's nature is simple or compound, saying:
"Do not take Riba; you think it enriches your wealth? In fact, it reduces national income." (Qur'an 3:129)
In the Quranic system, all the sources of wealth belong to the Islamic State and it is the responsibility of the state to fulfil the basic necessities of life of all its citizens. There is no need and no scope for the accumulation of wealth and, therefore, the question of having surplus money does not arise as it gets distributed among all the members of the society.
Till such time that the Islamic Economic Order is established in its totality, the Qur'an stipulates certain measures to regulate lending and borrowing on interest free basis to cope with such occasional situations as they arise.
The basic principle laid by the Qur'an is that "a man will get only what he works for" (Qur'an 53:39). In pre-Islamic days people were not aware of this concept. They would give an example and say that suppose a person buys a thing for Rs. 100/- and later sells it for Rs.110/- so he gets a profit of Rs. 10/-. Another person lends Rs. 100/- to someone and gets back Rs. 110/-. Both appear to be one and the same thing and there appears to be no difference between them (Qur'an 2:275). The Quran said that this concept is not correct. Riba is Har'am and Bai'a is Hal'al, or, lending against interest is forbidden and trading is permitted. In trading, both capital and labour are involved whereas in Riba, only capital is invested. When the capital is returned, the investor gets something extra without doing anything. So whatever he gets over and above his capital without labour is forbidden.
Even in trading if a person gets more than the worth of his genuine labour, such excessive charging is forbidden (Qur'an 53:39). In this context even the income from the land upon which the owner doesn't make any efforts or the rent from a house, come in this category. Generally, though, people term these two sources legal and condemn only the interest taken from banks, etc.
In fact, the Qur'an has used the term "Riba" to represent the capitalistic system of economics.
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