Peace
When a student goes to university, they have to pay tuition fees. Many students do this by taking out loans from the student loans company. The professors' salaries are paid with this same money (correct me if I'm wrong). So is it wrong/ haram to be a lecturer or professor considering their income comes from students who take out loans that are charged with interest?
On one hand, not all students pay with student loans as some come from more middle class or even wealthy backgrounds. Also, the universities themselves are not the ones charging the interest, it's the student loans company which is a separate entity.
“And for their taking interest even though it was forbidden for them, and their wrongful appropriation of other people’s property. We have prepared for those among them who reject faith a grievous punishment (4: 161)”
“That which you give as interest to increase the people’s' wealth increases not with God; but that which you give in charity, seeking the goodwill of God, multiplies manifold.” (30: 39)
As a side question, if on the other hand you are the student who is being charged interest and therefore the one who's being taken advantage of financially, is this forbidden and punishable by God? Or is it just the ones that charge interest and take money who will be punished by God?
Thanks
Salaam Sarah,
maybe you would like to consider this verse regarding the business,
4:29 O you who believe, do not consume your money between you unjustly, unless it is through a trade which is mutually agreed by you. And do not kill yourselves; God is Merciful towards you.I believe that everything that mutually agreed by both party in terms of business is good, even there's an interest rate applied. The underlying words is mutually agreed.
As long as both parties agree and respect the agreement that has been made, I think there is no problem.
Problems usually arise when there is a default in the payment of debts. Here
riba usually takes place.
ر ب و = Ra-Ba-Waw = it increased/augmented, the practicing/taking of usury,
excess/addition, an addition obtained more than what is supposed to be received, become high/grown up/large/swollen/risen, mount up, to grow/swell, out of breath, panting. rabiyatun - ever-increasing, severe. arba (comp. form) - more numerous, more increased.
It's an excess/ addition, or an addition obtained more than what is supposed to be received. This is something beyond what was agreed upon, such as fine/penalty (sometimes it through legal channels and civil courts).
God commands the creditor to restructure the debt until the debtor be able to pay back.
2:280 If the person is facing insolvency, then you shall wait until he becomes able. And if you relinquish it as a charity <saddaqa> it is better for you if only you knew.And debt remission as sadaqa is a better option if the creditors believe in God and hereafter.
It is a common practice in the financial and banking industry today to restructure debt when a default occurs. In some cases, bank interest is written off and principal payments are rescheduled, and sometimes a reduction of the principal amount owed (or discount) , depending on the severity of the debt default.
It's not easy for the banking or financial institution to do saddaqa or debt cancellation, since they might be owned by group of people or management with different interests. But I think this is something good.
So as long as both party believe in God and here after, The borrower has good will to pay back, and the lender do exactly as 2:280, I believe God will show them the way.
2:279 And if you will not do this, then be informed of a war from God and His messenger; but if you repent, then you will have back your principal money, you will not be wronged nor will you wrong.Peace
