Something doesn't track for me here. I know several Muslim families that all have mortgages on their homes, with interest rates. One family also has a business, with a couple of loans for it, also with interest. These do not seem to be in conflict with their laws, but somehow interest on a student loan is?
It's a "Convenient" interpretation of their religion. The provision involved (To the extent it even applies) like so many other business-killing religious dictates, has common fictions or work-arounds to avoid its true effect. Christians are prohibited from usury, but the definition of "usury" has changed over the centuries to mean the charging of
excessive interest, rather than the charging of
any interest, as it once did.
I am not familiar with this particular supposed prohibition in Islam, but if it is like the old traditional Christian interpretation, it would prevent only the
charging of interest by the lender, not the
payment of it by the borrower. If that's the case here, the entire objection is entirely specious.
By way of example on those fictions and work-arounds, prior to modern usages, life insurance was considered a payment of blood money and thus prohibited under Islam, until more modernly these policies came to be viewed as technically something else such as an exchange of gifts (Premiums during life vs. payouts on death) or simply a return of an investment (Islamic insurance salesmen must have really loved the company spiel on whole life and universal life policies on that one).
