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Why Choose Islamic Debt Solutions?
  • Getting rid of the debts completely via means such as bankruptcy, debt relief orders or a full and final settlement.
  • Freezing of interest on solutions such as Individual Voluntary Arrangements.
  • Aim to freeze the interest being charged with most creditors on a debt management plan.
debt management financial example

Islam Prohibits Interest


The huge debt that currently burdens many people has arisen from loans that have charged interest and have not shared risk between the lender and the borrower and have, therefore, contravened the two most fundamental principles of Islamic finance.

Islam commands us to refrain from charging interest and to share financial risk, seek to avoid the concentration of wealth and the economic exploitation of the weak and thereby prevent situations such as the current debt crisis from arising in the first place.

The core belief in Islamic finance is that money should not in itself be an earning asset; therefore Islam prohibits any and all forms of interest. There are several passages in the Qur’an which clearly condemn the practice of interest (referred to in Arabic as riba):

“O ye who believe! Fear Allah, and give up what remains of your demand for interest, if you are indeed believers. If you do not, take notice of war from Allah and his Messenger. But if ye turn back, ye shall have your capital sums: deal not unjustly and ye shall not be dealt with unjustly” (2:278-279)

Interest is considered an unjust and exploitative instrument of financing since the lender is assured a return without doing any work or sharing in the risk, while the borrower in spite of hard work, is not
assured of a positive return. Furthermore, if the borrower’s investment is unsuccessful through no fault of his or her own, it is unfair for the lender to demand repayment. The prohibition of interest is therefore a mechanism to establish justice between the lender and borrower.

Christian and Jewish theologies also maintained traditions against usury. In the Old Testament, for example, it says:

“If thou lend money to any of my people that is poor by thee, thou shalt not be to him as an usurer, neither shalt thou lay upon him usury. If thou at all take thy neighbour’s raiment to pledge, thou shalt deliver it unto him by that the sun goeth down” Exodus (22: 25-26).

In other words, not only is one not supposed to charge interest, but also if the collateral for a loan is in the form of a necessity like a coat, one must make sure that the borrower can still make use of it when it is needed. Anti-interest sentiment in the West existed as far back as Aristotle and was reinforced by the great Roman Catholic theologians, such as Augustine and Thomas Aquinas. There are further references against interest in Leviticus (25:35-37) and Deuteronomy (23:20). However, modern Christian and Jewish scholars have reinterpreted the term from its original meaning of “all” interest to “excessive” interest.

One of the better explanations as to the prohibition of riba is available here by Sheikh Imran N Hosein

Despite the prohibition of riba, the reality of the world we live in today is that a great many muslims (and non-muslims) are suffering from the negative effects of a riba based world economy.

So how can we help?

We would aim to achieve one of the following:

  • Getting rid of the debts completely via means such as bankruptcy, debt relief orders or a full and final settlement.
  • Freezing of interest on solutions such as individual voluntary arrangements.
  • Aim to freeze the interest being charged with most creditors on a debt management plan.

In addition, someone with debt issues is generally going to have three main concerns:

  • Finding an immediate solution to their debt issue, which would generally be in the form of an informal arrangement direct with their lenders, a Debt Management Plan, an IVA or Bankruptcy.
  • Finding ways of reducing their outgoings.
  • Finding means of increasing their current income or exploring means of generating a second income.

We are here to proactively help in all three categories inshallah, by doing so we find our clients are able to overcome their debt hurdle in a far shorter time frame.