AP: Experts Weigh in on Whether Student Loans Are Sharia Compliant
30 Jun 2022 apnews.com
MELBOURNE, Australia, July 04, 2022 (GLOBE NEWSWIRE) -- According to halal finance experts, Hejaz Financial Services, Islamic finance laws do not allow Muslims to borrow on interest. Central to Islam finance is the belief that money has no intrinsic value, but instead it is simply a medium of exchange. Benefitting from lending money by charging interest or repaying more than the initial amount borrowed (riba) is forbidden.
Australian Muslim students may be deterred from taking out student loans from the Government as they don’t fully understand how the loans work. The idea that student loans may not be compliant Sharia loans may act as a barrier to higher education for Muslims or could cause financial hardship for those who choose to fund their own university studies.