There is no sin in the Koran–not even drinking, not even fornicating, not even homosexuality–which could be as abhorrent and serious as dealing in riba [interest].” –SHAYKH NIZAM YAQUBY (at left)
There’s nothing in Osman Abdullah’s bearing to suggest an Islamic fundamentalist. He’s a businessman, sober in dress and political outlook. Ask him about America, and he’ll talk fondly of his time at the University of Wisconsin, where he earned his MBA. But when it comes to his banking habits–and the Koran’s ban on giving or receiving interest–Abdullah turns deadly serious. “Allah gave us very clear instructions: Don’t make money on money,” he says. The words from Chapter 2, Verse 278 of the Koran are, in fact, quite specific: “O you who believe! Have fear of Allah and give up what remains of what is due to you of usury…. If you do not, then take notice of war from Allah and His Messenger.” “If I break that,” says Abdullah, “I’m dead sure that I’m going to get very bad results in the hereafter. I believe it as I believe in talking to you now.”
We are talking, just now, outside Shamil Bank in the tiny Persian Gulf state of Bahrain. It’s the bank where Abdullah keeps his money, and, except for the tellers’ untrimmed beards and the section for ladies’ banking, it looks much like any other: customers standing in line, an ATM machine, a hum of efficiency.
But Shamil is not like any other bank. For starters, Abdullah’s savings account isn’t really a savings account at all, but something called a mudarabah account: Instead of earning fixed interest, his savings are invested directly in a range of ventures, such as construction projects and real estate. “In Islam, money has to work,” Abdullah explains. “If it works, we have to share the profits. If it doesn’t, you don’t owe me anything else.” That means his nest egg could shrink if enough of those ventures fail. But, he says, “I’m willing to take the risks.”
So, it turns out, are an increasing number of Muslims. At a time when the words “Islam” and “finance” are more likely to conjure the association “terrorist money laundering,” the Muslim world has quietly embarked on a very different sort of jihad: building a financial system where interest–a phenomenon as old as money itself–does not exist.