Islamic Economic

What is The Difference Between Renting and Interest?

Renting and interest differ from each other in these aspects:

Interest

  1. Interest comes out from giving (lending) money or money-like goods for a certain period of time and receiving it back with an extra benefit.
  2. The property loaned for interest is consumed. The borrower returns it by an equal amount of the same type, not the exact property itself.
  3. The risk of the loaned property belongs to the borrower. It doesn’t bother the lender if the property is vanished or stolen. The borrower should give the same amount with its interest at the end of the defined period no matter what.

Rent

  1. Renting means transferring the “usage right” of a property from the owner to someone for a certain period. The rental price is the cost of usage right for the defined period.
  2. The rented and the received property are exactly the same ones in renting. Rented properties cannot be consumed and consumer goods cannot be rented.
  3. All risks and the responsibility of keeping the rented property “ready to use” belong to its owner. Renters just pay for using it.

A house, a field or other types of properties which can be used and returned back later can be rented. All risks-except which arise from the intentional and culpable actions of renter- belong to the owner in this process.

Money and money-like goods cannot be rented because they are consumed. They can only be loaned and loans are subject to interest.


*What do you think about this topic? Please tell me what you think in the comment section below.
*Hit the like button if think this post is useful.
*Support this da’wah effort by following my blog.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: