A question regarding installment sales.
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The questioner : Regarding installment payments; we have the Muslim Brotherhood here, and they are operating in Alexandria. They have established Islamic companies, about seven contracting firms. They do not say that... it is on installments... they say everything is on installments, do you see? ... And they say it is on installments; because all the young people buy on installments, but they say it is on installments and do not say what? If the profit is so much or so much. There is no cash option. If they undertake a second project, do they say cash? So here, I mean...
The Shaykh : This is a complete scheme; I mean, they sell on installments, they do not sell for cash and on installments?
The questioner : No, they say - for example - the "Youth of Egypt" project on installments. It is a project they call "Youth of Egypt." They write about it in the newspapers and on television like this. What do they say? That it is on installments.
The Shaykh : I understood this, my brother, but I am asking you a question; do they not sell for cash?
The questioner : Do they sell for cash in other projects, not in the same project?
Another questioner : ... .
The Shaykh : Yes, in the cash project, do they not sell on installments?
The questioner : No, cash immediately.
The Shaykh : Okay; why did they do this? This is a complete scheme, but it is superficial. They understood the hadith... two sales in one sale, in these two forms you mentioned, there are not two sales in one sale. They escaped from the doubt, but why did the Lawgiver prohibit the sale of 'inah? It is a sale, but its objective is to make riba permissible. So it did not benefit them that they made the issue of the sale of 'inah under the name of sale; it did not benefit them at all, because actions are by intentions. This buyer intended it, and the seller assisted him, in the end, in the final outcome, they intended to make riba permissible. Because this person who needed the money went to Zayd, Bakr, and 'Amr: please give me four thousand. No one gives it to him. If he went to the moneylender and said: give me four thousand for a year. He would say to him: at your service, but after a year it will be four thousand and five hundred - for example. This is riba, this is forbidden, it is not permissible. But... they put the issue under the name of buying and selling, and it became lawful. This is the example of what the Jews did when they schemed regarding fishing on the Sabbath, and the story is known to everyone. But the Messenger gave us another example regarding the Jews' scheming, and he said - peace and blessings be upon him - :. Allah permitted the Jews to slaughter the permissible animals like sheep, cows, goats, and the like, but He prohibited their fats except for the red meat, as He said - the Exalted - : [An-Nisa 4:160]; so what did the Jews do? They took the fats and put them in large pots, and lit the fire underneath them until they melted and flowed, and took another form; this became lawful!! But it is the same fat itself, only its form changed. So they sold it and ate its price. He said - peace and blessings be upon him - : . So riba is forbidden, and praise be to Allah, there is no one today who says riba is lawful openly, except by way of twisting and turning! Among them is the sale of 'inah, but it is preceded - as we said - by installment sales; because how can one reach the sale of 'inah unless he sets two prices; a cash price and an installment price, and the play is completed as we described earlier.
These people you are talking about, I mean, they took the form - no offense - in the understanding of the Jews, I mean, it is a superficial issue. It was prohibited to have two sales in one sale; no, we do not sell two sales in one sale, we sell one sale, a cash sale on its own and an installment sale on its own. But if we revealed what is hidden in their hearts, we would find that when they sell on installments, they have added the excess profit to the cash sale. And we have, I mean, a very strange example. Some merchants in some Islamic countries heard the hadith "The Messenger of Allah - peace and blessings be upon him - prohibited two sales in one sale," and understood that it is not permissible for a merchant to ask for an increase in exchange for installment sales. So what did he do? He abolished the cash sale and made the whole sale on installments; but at what price? Installments are not at the cash price. But this one is not selling two sales, that one is selling two sales but separately, I mean. So if we understand that the Wise Lawgiver prohibited the increase in exchange for installments, it is because there is exploitation of the need of the needy among the Muslims, and there is the abolition of the good loan in the dealings of Muslims with each other, and there is the transformation of the Islamic society into a materialistic society like the disbelieving societies; such that there is no person who does good to his Muslim brother by being patient with him in repayment except from... So this is the wisdom of installment sales, and it is not that it is a superficial issue of two sales in one sale and that is all. No; the wisdom, as he said - peace and blessings be upon him - in the second hadith:Sunan Abi Dawud 3461Hasan (Al-Albani), so the issue and the cause is not combining two sales at one time, but the cause is taking the increase in exchange for one of the two sales, and they called it riba.
Are we going to the prayer now? Or are you going to be late? No.
The questioner : Regarding the topic of installments, some people... the refrigerator... and they go and buy it on installments, and they come to one... half the price they bought it for, the cause... with money... .
The Shaykh : This is correct.
The questioner : The type... they buy refrigerators and they buy things... they pay a down payment... sale on installments... and they sell it for much less, about half the price they bought it for on installments, in order to take... and then they add to the salary.
The Shaykh : This is a complete scheme; I mean, they sell on installments, they do not sell for cash and on installments?
The questioner : No, they say - for example - the "Youth of Egypt" project on installments. It is a project they call "Youth of Egypt." They write about it in the newspapers and on television like this. What do they say? That it is on installments.
The Shaykh : I understood this, my brother, but I am asking you a question; do they not sell for cash?
The questioner : Do they sell for cash in other projects, not in the same project?
Another questioner : ... .
The Shaykh : Yes, in the cash project, do they not sell on installments?
The questioner : No, cash immediately.
The Shaykh : Okay; why did they do this? This is a complete scheme, but it is superficial. They understood the hadith... two sales in one sale, in these two forms you mentioned, there are not two sales in one sale. They escaped from the doubt, but why did the Lawgiver prohibit the sale of 'inah? It is a sale, but its objective is to make riba permissible. So it did not benefit them that they made the issue of the sale of 'inah under the name of sale; it did not benefit them at all, because actions are by intentions. This buyer intended it, and the seller assisted him, in the end, in the final outcome, they intended to make riba permissible. Because this person who needed the money went to Zayd, Bakr, and 'Amr: please give me four thousand. No one gives it to him. If he went to the moneylender and said: give me four thousand for a year. He would say to him: at your service, but after a year it will be four thousand and five hundred - for example. This is riba, this is forbidden, it is not permissible. But... they put the issue under the name of buying and selling, and it became lawful. This is the example of what the Jews did when they schemed regarding fishing on the Sabbath, and the story is known to everyone. But the Messenger gave us another example regarding the Jews' scheming, and he said - peace and blessings be upon him - :
May Allah curse the Jews. The fats were prohibited for them, so they rendered them, then sold them, and ate their price; for when Allah prohibits the eating of something, He prohibits its price.
لعن الله اليهود حُرِّمت عليهم الشُّحوم ، فجَمَلُوها ، ثم باعوها ، وأكلوا أثمانها ؛ فإن الله إذا حرَّم أكل شيئًا حرَّم ثمنهFor wrongdoing on the part of the Jews, We made unlawful for them [certain] good foods which had been lawful to them
فَبِظُلْمٍ مِنَ الَّذِينَ هَادُوا حَرَّمْنَا عَلَيْهِمْ طَيِّبَاتٍ أُحِلَّتْ لَهُمْAnd when Allah prohibits the eating of something, He prohibits its price.
وإن الله إذا حرَّم أكل شيئًا حرَّم ثمنهThese people you are talking about, I mean, they took the form - no offense - in the understanding of the Jews, I mean, it is a superficial issue. It was prohibited to have two sales in one sale; no, we do not sell two sales in one sale, we sell one sale, a cash sale on its own and an installment sale on its own. But if we revealed what is hidden in their hearts, we would find that when they sell on installments, they have added the excess profit to the cash sale. And we have, I mean, a very strange example. Some merchants in some Islamic countries heard the hadith "The Messenger of Allah - peace and blessings be upon him - prohibited two sales in one sale," and understood that it is not permissible for a merchant to ask for an increase in exchange for installment sales. So what did he do? He abolished the cash sale and made the whole sale on installments; but at what price? Installments are not at the cash price. But this one is not selling two sales, that one is selling two sales but separately, I mean. So if we understand that the Wise Lawgiver prohibited the increase in exchange for installments, it is because there is exploitation of the need of the needy among the Muslims, and there is the abolition of the good loan in the dealings of Muslims with each other, and there is the transformation of the Islamic society into a materialistic society like the disbelieving societies; such that there is no person who does good to his Muslim brother by being patient with him in repayment except from... So this is the wisdom of installment sales, and it is not that it is a superficial issue of two sales in one sale and that is all. No; the wisdom, as he said - peace and blessings be upon him - in the second hadith:
If anyone makes two transactions combined in one bargain, he should have the lesser of the two or it will involve usury.
من باع بيعتَين في بيعة فله أوكَسُهما أو الرباAre we going to the prayer now? Or are you going to be late? No.
The questioner : Regarding the topic of installments, some people... the refrigerator... and they go and buy it on installments, and they come to one... half the price they bought it for, the cause... with money... .
The Shaykh : This is correct.
The questioner : The type... they buy refrigerators and they buy things... they pay a down payment... sale on installments... and they sell it for much less, about half the price they bought it for on installments, in order to take... and then they add to the salary.
Source
www.al-albany.com
The Arabic text is copied verbatim from the original source, without any edits.