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Do Muslim students have to compromise faith to fund medical training?
With the average medical student debt on graduation currently more than £20,000 without tuition fees, where does this leave British Muslims with regards to student finance? Islamic scholars are divided on whether student loans are compliant with Islamic (Shariah) law, with the argument hinging on whether the loans are in essence interest-free. The website of the Islamic Bank of Britain states:
As a matter of faith, a Muslim cannot lend money to, or receive money from someone and expect to benefit – interest (known as riba) is not allowed.
Riba also applies when borrowing money, as the lender profits from the applied interest. To comply with Shariah, any loan must be Qard (free of profit).
Are student loans Qard?
Student loans do accrue interest but at a very low rate, equivalent to the rate of inflation. On a loan of £22,000, this could mean repaying £27,000 in total (based on 2.5% inflation and repaying the loan within 6 years of graduation). The difference ensures that the value of the loan that is repaid remains the same in real terms as the amount borrowed. Therefore, as the Loan Company is not actually profiting from the interest, only covering their costs, student loans are surely Qard? Not so, according to Dr Monzer Kahf, a prominent Muslim economist writing for www.islamonline.net who states that:
You cannot change what is due from a person, and any increase in what is due from a person is Riba… I think [an interest rate equal to the rate of inflation] is a Riba, although it less severe than normal increments that are not tied to inflation.
Is it permissible to take a Riba loan for study?
The Muslim Council of Britain’s stance is that the student should first try to borrow money from their family, friends or any other source as Qard-I Hassanah (interest free loan) but if this is not possible they may take the loan on interest with firm intentions to repay it as soon as possible. Whilst approaching family and friends for loans might get around the problem of interest, for most students it is simply not a realistic proposition. One student comments;
A student loan is a matter of necessity. How many families can spend 25 grand (approx for med school) on each child they have? Because of that, most people need the loans…I think its inappropriate to ask extended family for that kind of money (unless they offer it) so it all boils down to it being a necessity anyway.
As Basaam Aweid, an F1 doctor who recently took part in a forum discussion for St Georges University of London Islamic Awareness Society explains;
Essentially in Islam we have fundamental concepts and detailed juridical issues. The former we are required to comprehend and accept through our own intellectual research but the latter is a detailed science of its own. ‘Interest’ falls into this category and we follow dedicated scholars who derive rulings for us following extensive research into Islamic literature (The holy Quran and the recorded sayings, teachings and history of the holy prophet, his family and companions)… The ‘strictest’ scholar would say that we should only take out loans if it is a "life or death" situation. Others fully permit loans for Muslims living in non-Muslims countries.
Dr. Muzammil Siddiqi, former president of the Islamic Society of North America, where loans are even higher, points out that the field of education is also significant. Studying medicine may be a more justifiable and productive use of a loan but "if a study is not necessary and it is only as a matter of enhancement of one's knowledge, then one should not take loans with interest." Other scholars such as the grand Ayatollah Al Sistani of Iraq, make an exception for Muslims living in western countries where banks are not operated by Muslims. He explains that these transactions are permissible only if the money is taken out with a special intention that does not envisage paying back a loan with interest. (Ayatollah Sistani's teachings available at www.sistani.org ) |
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