Qarz

Qarz is a term used in Arabic, Persian, Urdu and related languages to denote a loan or debt. In Arabic, the root qarḍ (قرض) refers to lending and the resulting obligation of repayment. In Persian and Urdu, qarz similarly means loan or debt and appears in everyday speech as well as legal and financial terminology. The word is often encountered in discussions of personal finance, banking, and Islamic jurisprudence.

In Islamic jurisprudence, qarḍ is generally neutral, but a distinction exists between ordinary loans and qard hasan. Qard hasan (often written qard-e hasan in Persian or Urdu transliteration) means a benevolent loan extended without any interest or profit expectation. The borrower repays only the principal; terms may be time-bound, but the lender does not charge interest and may forgo additional charges. Loans with interest are prohibited under riba, and Shariah-compliant contracts emphasize transparency, fairness, and avoidance of excessive uncertainty (gharar).

In modern contexts, qarz appears in personal finance, microfinance, and charitable lending. Qard Hasan programs are administered by charitable organizations, religious groups, and some banks offering interest-free loans to low-income borrowers or students. In many Muslim-majority countries, qarz-related terms help frame debt relief, social welfare, and community lending, with documentation and repayment schedules to protect both borrower and lender.