Why Riba is Forbidden
“Allah has permitted trade and forbidden riba (interest).” — Quran 2:275
“Allah has cursed the one who consumes riba, the one who pays it, the one who witnesses it, and the one who records it.” — Prophet ﷺ
How to Avoid Riba in Business
- Do not take interest-bearing loans
- Do not charge late payment fees based on interest
- Use Islamic financing alternatives
- Save to fund your business rather than borrow with interest
- Use profit-sharing arrangements instead
Halal Financing Alternatives
- Personal savings — Start small with your own money
- Family loans — Interest-free loans from family
- Musharakah — Partnership profit-sharing
- Murabaha — Cost-plus financing
- Qard Hasan — Beautiful loan (interest-free)
- Grants and competitions — Free funding from organisations
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