Riba

Riba is the Arabic term for interest, which is prohibited under Islamic (Sharia) law regardless of the interest rate charged. In forex, this prohibition is the direct reason Islamic (swap-free) trading accounts exist, since the standard overnight swap charge is itself a form of interest on a leveraged position. Brokers offering swap-free accounts typically replace the swap with a fixed, disclosed administrative fee instead, structured to avoid the interest classification while still covering the broker's financing cost.