The Ruling on Installment Sales with an Increase in Price

Question:
May Allah bless you. Among the questions that reached us, this questioner says: What is the ruling on installment sales with an increase in the price, meaning the price of the commodity?

Answer:
The ruling on installment sales with an increase in the price of the commodity is permissible. It is prescribed for the seller to increase the price of his commodity if he wants to sell it on credit, and that is not riba (usury or interest), because an installment sale is not a cash sale. The custom of the Muslims from the time of the Prophet (peace and blessings be upon him) until our day has been to sell this way, because a sale on credit involves an increase. If the commodity is worth one hundred, he sells it for one hundred and twenty, one hundred and forty, or one hundred and fifty, depending on the terms. If the term is short, the profit is small, and if the term is long, the profit is large. People have continued to buy and sell in the time of the Prophet (peace and blessings be upon him), and he did not say to them, "Do not sell except at the cash price." Yes.