—may Allah be pleased with him. This occurred when ‘Umar ibn al-Khattāb, may Allah be pleased with him, sent someone to remove from the marketplace anyone who was not versed in Islamic law. Ya‘qūb was among those removed, so he went to ‘Uthmān ibn ‘Affān, may Allah be pleased with him, and told him what had happened. ‘Uthmān gave him a bag of uncoined gold as qirād, with the profits to be divided equally, and told him, “If anyone comes to interfere with you, say, ‘The wealth belongs to ‘Uthmān.’” He said this and was not removed. He then returned with one bag containing the capital and another containing the profit.

It is also said that the first qirād in Islam was that of ‘Abd Allāh and ‘Ubayd Allāh, the two sons of ‘Umar ibn al-Khattāb—may Allah be pleased with them all. ‘Abd Allāh and ‘Ubayd Allāh, the two sons of ‘Umar ibn al-Khattāb, may Allah be pleased with them both, had set out with an army for Iraq. When they visited Abū Mūsā al-Ash‘arī, who was governor of Basra, he welcomed them warmly and said, “If I could find some way to benefit you both, I would.” Then he said, “Indeed, there are some of Allah’s funds here that I intend to send to the Commander of the Faithful. I will lend them to you so that you can buy merchandise in Iraq and sell it in Medina. You can then repay the capital to the Commander of the Faithful and keep the profit.” They replied, “We would welcome that.” He did so and wrote to ‘Umar ibn al-Khattāb asking him to collect the money from them.

When they arrived, they sold the merchandise and made a profit. When they handed the money to ‘Umar ibn al-Khattāb, he asked, “Did he lend every member of the army as much as he lent you?” They replied, “No.” ‘Umar ibn al-Khattāb said, “You are the two sons of the Commander of the Faithful, so he lent it to you! Hand over the money and its profit.” ‘Abd Allāh remained silent, but ‘Ubayd Allāh said, “You should not do this, Commander of the Faithful. Had the capital diminished or been lost, we would have been liable for it.” ‘Umar said, “Hand it over.” ‘Abd Allāh remained silent, while ‘Ubayd Allāh argued his case again.

A man sitting with ‘Umar said, “Commander of the Faithful, why not treat it as a qirād?” ‘Umar replied, “I have made it a qirād.” ‘Umar therefore took the capital and half its profit, while ‘Abd Allāh and ‘Ubayd Allāh, the two sons of ‘Umar ibn al-Khattāb, took the other half of the profit.

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Qirād is an institution in its own right. It is a concession affording Muslims latitude because of the necessity that called for it, and it may therefore be practised only in accordance with its established rules. The established practice for a recognised, permissible qirād is