What are Riba, Gharar & Maisir?
Riba simply means a prohibited gain under Sharia. Riba would cover all gains from loans and debts, anything over and above the principal amounts. In the context of Islamic finance, Riba can simply be construed as the prohibition of interest in the conventional sense, a concept prohibiting the making of money from money whether excessive or otherwise. The guiding principle of Islamic finance is the prohibition of interest-based lending, but capital providers and investors are not prevented from earning returns on their capital or investment appropriate to the duration of their commitment and exposure to risks. It is the exposure to risks over specific time periods that justify the earning of returns which could be in the form of profits, rentals, fees or commission. Gharar and Maisir refer to uncertainty and gambling respectively. One of the underlying objectives of Islamic finance is to prevent dealings involving uncertainty, hazard, chance or uncontrollable risk leading to speculation
