Fatwa ID: 06416
Answered by: Maulana Mohammed Dilwar Hussain
Question:
How do we deal with late payment stipulations within contracts?
In the name of Allāh, the Most Gracious, the Most Merciful
Answer:
Any increase to the principal amount is considered Riba (usury/interest). This is regardless of them being categorised as late fees, APR, prepayment fees, set up fees, admins fees and etc.
All of which have been made categorically prohibited by Allāh Ta’ālā;
“Those who take ribā (usury or interest) will not stand but as stands the one whom the demon has driven crazy by his touch. That is because they have said: “Sale is but like ribā.’’, while Allāh has permitted the sale and prohibited ribā. So, whoever receives advice from his Lord and desists (from indulging in ribā), then what has passed is allowed for him, and his matter is up to Allāh. As for the ones who revert back, those are the people of Fire. There they will remain forever.” [Surah al-Baqarah; 2:275] [1]
“O you who have believed, do not consume usury, doubled and multiplied, but fear Allāh that you may be successful.” [Surah Al-Imrān; 3:130] [2]
“And for their charging Ribā (usury or interest) while they were forbidden from it, and for their devouring of the properties of the people by false means. We have prepared, for the disbelievers among them, a painful punishment.” [Surah an-Nisā’; 4:161] [3]
The Prophet ﷺ forbade the use of the price of blood and the price of a dog, the one who takes (eats) usury the one who gives usury, the woman who practises tattooing and the woman who gets herself tattooed. [Sahih al-Bukhāri: Hadith 5945] [4]
Only Allāh Ta’ālā knows best.
Written by Maulana Mohammed Dilwar Hussain
Checked and approved by Mufti Mohammed Tosir Miah
Darul Ifta Birmingham
}[1]ٱلَّذِينَ يَأۡكُلُونَ ٱلرِّبَوٰاْ لَا يَقُومُونَ إِلَّا كَمَا يَقُومُ ٱلَّذِي يَتَخَبَّطُهُ ٱلشَّيۡطَٰنُ مِنَ ٱلۡمَسِّۚ ذَٰلِكَ بِأَنَّهُمۡ قَالُوٓاْ إِنَّمَا ٱلۡبَيۡعُ مِثۡلُ ٱلرِّبَوٰاْۗ وَأَحَلَّ ٱللَّهُ ٱلۡبَيۡعَ وَحَرَّمَ ٱلرِّبَوٰاْۚ فَمَن جَآءَهُۥ مَوۡعِظَة مِّن رَّبِّهِۦ فَٱنتَهَىٰ فَلَهُۥ مَا سَلَفَ وَأَمۡرُهُۥٓ إِلَى ٱللَّهِۖ وَمَنۡ عَادَ فَأُوْلَٰٓئِكَ أَصۡحَٰبُ ٱلنَّارِۖ هُمۡ فِيهَا خَٰلِدُونَ
[2]يَٰٓأَيُّهَا ٱلَّذِينَ ءَامَنُواْ لَا تَأۡكُلُواْ ٱلرِّبَوٰٓاْ أَضۡعَٰفا مُّضَٰعَفَة وَٱتَّقُواْ ٱللَّهَ لَعَلَّكُمۡ تُفۡلِحُونَ {
[3]وَأَخۡذِهِمُ ٱلرِّبَوٰاْ وَقَدۡ نُهُواْ عَنۡهُ وَأَكۡلِهِمۡ أَمۡوَٰلَ ٱلنَّاسِ بِٱلۡبَٰطِلِۚ وَأَعۡتَدۡنَا لِلۡكَٰفِرِينَ مِنۡهُمۡ عَذَابًا أَلِيم{
[4]حَدَّثَنَا سُلَيْمَانُ بْنُ حَرْبٍ، حَدَّثَنَا شُعْبَةُ، عَنْ عَوْنِ بْنِ أَبِي جُحَيْفَةَ، قَالَ رَأَيْتُ أَبِي فَقَالَ إِنَّ النَّبِيَّ صلى الله عليه وسلم نَهَى عَنْ ثَمَنِ الدَّمِ، وَثَمَنِ الْكَلْبِ، وَآكِلِ الرِّبَا وَمُوكِلِهِ، وَالْوَاشِمَةِ وَالْمُسْتَوْشِمَةِ.
