Can I Ask Someone for a Loan and Offer to Pay Them Back 10% Extra as an Incentive

CategoriesTrade, Business & All Things Money [558]

Fatwa ID: 04363

Answered by: Maulana Mohammed Kamran Abid




Salam. Is it halal if I ask someone for a loan and offer to pay them back 10% extra as an incentive? This would be straightforward riba, right?



بِسْمِ اللهِ الرَّحْمنِ الرَّحِيْم

In the name of Allah, the Most Gracious, the Most Merciful




Waalaykumus Salaam. Allah says in the Quran, “Allah has permitted trade and forbidden usury.”[1]

There is a principle in Islamic jurisprudence that any loan which has a benefit is not permissible. Therefore, it would not permissible to ask someone for a loan and offer to pay them 10% extra because the extra amount would be considered riba.[2]



Only Allah knows best

Written by Maulana Mohammed Kamran Abid

Checked and approved by Mufti Mohammed Tosir Miah

Darul Ifta Birmingham



[1](Surah al-Baqarah, verse 275)

[2](Radd al-Muhtaar, vol. 5, pg. 166, Darul Fikr Beirut)


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