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Riba
OED Definition:
In Islamic law: interest, usury.
Riba is prohibited in Qur’anic verses (e.g. 2:275–9), but precisely what constitutes riba is debated by Islamic jurists.
How this term should be used
Expert Islamic financial advice should be sought before using this term.
Although the Quran expressly prohibits Riba, the definition of what constitutes this type of interest is contested in Islamic scholarship.
In the Prophet Muhammad’s lifetime, fixed term transactions were a common feature of Meccan trading and it was often stipulated that any debtor who could not repay the capital (with the interest due) on or before the specified date was given an extension to repay on the condition that the sum due was also doubled. It is, therefore, not difficult to imagine how this custom could be abused by usurious individuals in a practice that bears some resemblance to the predatory lending of the present day.
Whether the Quranic prohibition on Riba means that charging interest is prohibited full stop is a matter of open debate, though Islamic legal scholars have typically interpreted it as prohibiting any financial transaction contract, such as a loan or investment, that specifies a fixed return to the lender.
Nevertheless, in the present day, most Muslim majority countries allow the charging of what is loosely described as non-usurious interest.