Bringing Interest-Free Student Loans to Canada
Bismillah.
Anybody who is going to University will tell you how difficult it is to manage expenses (unless your parents are filthy rich). For Muslims, it’s even more difficult since we cannot accept loans or contracts that have interest in them. Here’s a potential solution:
Inspired by emails sent by Muslim brothers/sisters who wanted to avoid haram and get out of interest-based loans, we decided that it is about time someone started showing the Canadian community benefits of interest-free banking by using student loans as a starting point. Being involved in the RBC Challenge as part of our Masters program gave us a great channel to push this idea forward.
We are trying to figure out a business model that is completely interest-free and at the same time provides a win-win situation. There are still a number of kinks to figure out and that is why getting feedback from the community is so important. The survey results will help us immensely in putting together a value proposition for RBC.
If implemented, this product will help students acquire student-loans that have no interest associated with them. This will especially help students who are religiously-averse to dealing in interest transactions.
Please contribute your opinions by filling out this 10-Question survey and sharing it with as many people as possible (it should about 5 minutes). We hope to start compiling survey results by November 15th:
http://www.surveymonkey.com/s.aspx?sm=BhHVpCmtPNWnp5_2f4waWnwQ_3d_3d
Please fill in the survey, it takes at most five minutes, in sha Allah.
Remember that, “whosoever intercedes for a good cause, will have the reward thereof.” [Nisa:85]
[...] very nice initiative is going on in Canada, make sure you read about it on True and Good Words here, and if you’re in Canada, take the survey please [...]
Bringing Interest-Free Loans to Canada « .:Tayyibaat:.
November 10, 2008 at 12:58 pm
I emailed the survey administrator regarding one of the questions: “5. On an interest-free student loan, would you be willing to pay “up-front” service charges that are equivalent to interest charges over the loan period?”
My concern is that this is still riba. Any comments?
Abdullah
November 10, 2008 at 1:23 pm
Abdullah
WAllaho alam, but that sounds like riba to me too.
That’s why all of should choose no for that option in the survey
My concern is that this product will come out “half-halal”…meaning, it looks interest free but it has interest somewhere in the contract or in some other way.
abdalmutakkabir
November 10, 2008 at 4:55 pm
[...] out this initiative by a group of Muslim students in Canada towards working to introduce interest-free student loans: [...]
Interest-free student loans (proposal)
November 12, 2008 at 2:19 am
I agree. I am scared they will come out with something outright haraam but call it “islamic or shariah banking”.. audhubillah.. muslims, please use your brains.. dont be so gullible
(from islamqa)
It is haraam for the Muslim to borrow gold, silver or money from someone on the basis that he will pay back more than he borrowed, whether the lender is a bank or anyone else, because that is riba, which is one of the worst of major sins. Any bank that deals in such transactions is a riba-based bank.
Fataawa Islamiyyah, 2/412
http://www.islamqa.com/en/ref/45910/debt%20and%20repayment
Abdullah
November 18, 2008 at 7:42 am
We have started an organization providing interest free student loans in Canada, if you are interested I would be glad in discuss and share ideas.
Rabia
December 22, 2008 at 10:41 pm
Hi there! I like your site
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Wasygrealge
December 27, 2008 at 8:03 pm
[...] item that is no doubt of extreme interest to all of you is that of Making Interest-Free Student Loans A Reality. Team RICE, which includes members of the MSA, has been selected as a potential finalist for the [...]
Open Thread + Interest-Free Student Loans | MuslimMatters.org
January 11, 2009 at 5:58 pm
[...] you have any other models that you are aware of please share in the comments below. Also, True and Good Words has a survey for Canadians on creating a business model for interest free loans. FYI, This is an [...]
Student Loans…What’s a Muslim to do? | Muslim Investor
January 19, 2009 at 12:49 pm
Good initiative, I am a mom of tow and would like to continue my studies. I have to avoid interest based loans, but if this option is available I will go for it and ear my masters degree Inshallah.
Shadia
February 5, 2009 at 1:19 am
Aslaamolaikum-What is the latest update on the ‘Interest Free Student Loans’ Have they been made available for the Muslim students as yet Or is this still in its ‘incubation’ period?
By An Avid Muslim Student in dire need for Interest Free loan
Jazakamullha-ho-Khairun for all your efforts
Taqaballaho
Liaison
June 21, 2009 at 8:43 pm