Is it permissible to waive part of a debt in exchange for early repayment?

Question:
May Allah reward you. Honorable Shaykh, this questioner says: If I have a debt owed to me by a person, paid in installments, is it permissible for me to say to him, "Pay me three-quarters of the debt now, and I will waive the rest"?

Answer:
This is the issue of "waiving and accelerating" (dha' wa ta'jil). The scholars differ on this matter. The majority hold that it is not permissible, because it is selling currency for currency, selling deferred currency for immediate currency in a lesser amount, so it is not permissible. It falls under the category of riba (usury or interest). Imam Ibn al-Qayyim and a group of scholars say, "No, this is not of that, this is not of riba. This is a waiver by the owner of the right, a reduction by the creditor, so there is no riba in it. It is not selling currency for currency, but rather a waiver." And the Prophet (peace and blessings be upon him), when he wanted to expel the Banu Nadir from Madinah, and they had debts owed to people, said to them, "Waive and accelerate." This is permissible. Ibn al-Qayyim's choice is that it is permissible, because it is not selling currency for currency, but rather it is a waiver of part of the amount solely for the sake of accelerating it.