Loans, Tawarruq, discounting, financing of business : loan with interest

Fatawa Question

Dear Prof. Dr. Monzer Kahf, Assalamu Alaikum Sheikh, One of my friends here in Sri Lanka wants to apply for the Student Visa to the UK. He has to pay GBP £ 2000 / = to a college in the UK in order to get the offer letter. In Sri Lankan currency, this costs around Rs.400,000 /. Since he is from a middle class family, he is not in a position to pay that amount immediately. Therefore another person has agreed to pay that amount on behalf of him, but he (my friend) should repay that amount with an additional sum of Rs.50,000 /. In other words, the person sponsoring is giving Rs.400,000 / and getting back Rs.450,000 /. I think this additional sum of Rs.50,000 / is a pure interest. What do you think about this………. ???? May Allah bless you……… Best regards, Azam

Fatwa

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Publication Date

2009-08-19

Main Subjects

Economics & Business Administration
Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Loans
• Usury

No. of Pages

1

Data Type

Fatawa

Language

English

Record ID

BIM-729700

• APA
• MLA
• AMA