With respect specifically to the prisoners of war, Islam decrees:1
That is: Then afterwards either release them as a favour or by taking ransom.
No third option is given. The captor can either release prisoners of war out of compassion and rest assured that God is pleased with his action or if financial hardship does not allow the captors to set prisoners of war free without recompense, then it is permissible to charge the customary ransom for release. However, what happens if neither the prisoner nor his country or family have the resources to pay ransom? Islam then allows the prisoner to pay his ransom in regular instalments and thereby earn his freedom. Allah the Almighty says:2
That is: If you have a prisoner whom you cannot release as a favour, and his relatives can not pay the ransom, then if such a prisoner desires a deed of manumission in writing, write it for them if you know any good in them; and give them out of the wealth of Allah which He has bestowed upon you.
In situations where the slave is unable to pay the ransom, this verse enjoins that a bond be executed between a master and his slave, which binds the latter to pay the ransom in agreed instalments. After this bond has been executed, the slave is immediately restored to freedom, and he is free to take up any trade he may have an aptitude for. As a beautiful, crowning gesture of goodwill, the master, out of his own assets, is directed to provide the prisoner with some capital to start him on the new venture. Out of these earnings, the master is not entitled to anything beyond the agreed fixed instalment.
When one considers the Islamic teachings regarding slavery, it becomes clear that Islam leaves absolutely no avenue open for any person to make another person a slave. Even when prisoners of war are taken, the captors are encouraged to set them free as a favour or else they must be set free on payment of a reasonable ransom. If there is a prisoner who cannot ransom himself and his friends or his government take no steps towards paying his ransom, he can gain freedom by giving an undertaking that would enable him to pay his ransom in instalments out of his earnings. Destitute prisoners are even helped with some capital to enable them to earn their livelihood and gain freedom. If in the presence of such extraordinary concessions, a prisoner does not avail himself of the opportunities offered, it can only mean that he finds his ‘bondage’ among Muslims more agreeable than free life among his own people.
Careful consideration of these injunctions makes it obvious that Islam leaves no room for anyone to enslave another free person. The first commandment is to free the slaves as a favour, without any ransom. If that is not possible, Islam enjoins freeing the prisoners with an appropriate ransom. If a prisoner cannot arrange for the ransom from his own resources, or from his relatives, he can execute a bond and would, for all practical purposes, be totally free owing nothing more than the agreed instalment.
The slave who stabbed and martyred Hazrat Umar(ra) was himself set free according to the ransom guidelines given above. One day, the slave approached the Muslim who he lived with, and proposed payment of a fixed instalment of ransom out of his income in exchange for his freedom. A contract was signed that mandated the slave to earn his freedom by paying the agreed instalments. However, one day he complained to the Khalifah that his instalment was too heavy and that it should be reduced. On investigation, Hazrat Umar(ra) found that the man’s income was many times greater than the agreed instalment. His application was therefore rejected, which made him furious. He thought that justice had been denied to him on racial grounds, as he was a Persian while his former master was an Arab. So the next day he stabbed Hazrat Umar(ra) with a dagger, who was martyred because of the wounds.
To sum up, Islam gives a right to any prisoner of war to gain his freedom by paying ransom in cash or in agreed instalments. If he is then unable to embark upon an economic activity for lack of capital, the master or the government is enjoined to assist him in procuring the needed funds to gain his freedom.