Fatwa ID: 05294

Answered by: Mufti Eunus Ali

Question

I incurred some credit card debt and was unable to pay it back and unfortunately ended up filing for bankruptcy. I believe the bank has cleared their records and won’t be taking the money and I’m wondering if I can donate the money to a charity instead?

In the name of Allah the most Beneficent, the Most Merciful

Answer

It is narrated from ‘Abdullah bin AbiQatadah that his father said: “A man came to the Messenger of Allah (ﷺ) and said: ‘O Messenger of Allah if I am killed in the cause of Allah with patience and seeking reward, facing the enemy and not running away, do you think that Allah will forgive my sins?’ The Messenger of Allah (ﷺ) said: ‘Yes.’ When the man turned away, the Messenger of Allah (ﷺ) called him back and said: ‘What did you say?’ He repeated his question, and the Messenger of Allah (ﷺ) said: ‘Yes, except debt. Jibril told me.'”[1]

In regards to your question, an effort needs to be made to repay any outstanding debt that you may have in accordance with the teachings of the above Hadith. Failing to do so will make one sinful and answerable to Allah.

However, if it is not possible to repay the amount as a result of filing for bankruptcy and the bank will not accept the money, then in that situation, you may either use the money for yourself or give it to charity.

If after filing for bankruptcy the bank is willing to take the payment, it will need to be repaid.

Allah has stated:

Surely, Allah commands you to deliver trusts to those entitled to them (Surah Nisa: 58)

As the money was loaned to you with trust, it will have to be returned as instructed by the Quran if and when possible. [2]

Furthermore, it is narrated by Abu Huraira (may Allah be pleased with him): The Prophet (ﷺ) said, “Whoever takes the money of the people with the intention of repaying it, Allah will repay it on his behalf, and whoever takes it in order to spoil it, then Allah will spoil him.”[3]

Only Allah knows best

Written by Mufti Eunus Ali

Checked and approved by Mufti Mohammed Tosir Miah

Darul Ifta Birmingham

[1] Sunan Nasai: 3156

[2] Mariful Quran, Volume 2, Page 468 &469

[3] Saheeh Bukhari: 2387