Ruling on merchants giving promotional prizes to their customers
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His Eminence the Shaykh: Some merchants offer prizes and gifts to those who purchase from their store for a certain amount. Is this permissible?
There is nothing wrong with this, provided that his selling price is the same as that of other people. For example, if this carton costs ten to other people and he sells it for ten, but he offers a prize to whoever buys, say, one hundred cartons, or spends a thousand riyals, then there is nothing wrong with it. This is with regard to the one who offers the prize.
As for the buyer, if he buys something he does not need, but only in the hope of winning a prize, then this is forbidden; because it is a waste of money. I have heard that some people buy cartons of milk that they do not want and pour it out, but only to get the prize. This is not permissible; because it is a waste of money, and the Prophet (peace and blessings be upon him) forbade the wasting of money.
So the issue now has two considerations: The first consideration is for the one who offers the prize,And the second consideration: To the buyer.
If the one who offers the prize does not add an extra amount to the price of his goods for the sake of the prize, meaning: people sell for ten and he sells for ten, then he owes nothing,As for the buyer, we tell him: Are you buying because you need this item,And you say: Since you need it, buying from this seller who has a prize, in the hope that it might be mine, is more pleasing to me than buying from someone who does not have a prize. So there is nothing wrong with this.
But if he buys and has no need for it, but only in the hope of getting the prize, then this is forbidden because it is a waste of money, and because he might buy many things and not get the prize, in which case he would be taking a risk and gambling.
It remains to be said regarding the first issue: If the one who offers the prize sells as people sell, would this not be a case of cutting off the livelihood of others; because people might flock to him and leave the others?We say: This is correct, it may have an effect. So if the one in authority or his representative—such as the municipality, for example, which oversees people’s markets—prohibits such a thing, they have the right to do so. And this would be a matter of regulation and protecting the markets from manipulation.
There is nothing wrong with this, provided that his selling price is the same as that of other people. For example, if this carton costs ten to other people and he sells it for ten, but he offers a prize to whoever buys, say, one hundred cartons, or spends a thousand riyals, then there is nothing wrong with it. This is with regard to the one who offers the prize.
As for the buyer, if he buys something he does not need, but only in the hope of winning a prize, then this is forbidden; because it is a waste of money. I have heard that some people buy cartons of milk that they do not want and pour it out, but only to get the prize. This is not permissible; because it is a waste of money, and the Prophet (peace and blessings be upon him) forbade the wasting of money.
So the issue now has two considerations: The first consideration is for the one who offers the prize,And the second consideration: To the buyer.
If the one who offers the prize does not add an extra amount to the price of his goods for the sake of the prize, meaning: people sell for ten and he sells for ten, then he owes nothing,As for the buyer, we tell him: Are you buying because you need this item,And you say: Since you need it, buying from this seller who has a prize, in the hope that it might be mine, is more pleasing to me than buying from someone who does not have a prize. So there is nothing wrong with this.
But if he buys and has no need for it, but only in the hope of getting the prize, then this is forbidden because it is a waste of money, and because he might buy many things and not get the prize, in which case he would be taking a risk and gambling.
It remains to be said regarding the first issue: If the one who offers the prize sells as people sell, would this not be a case of cutting off the livelihood of others; because people might flock to him and leave the others?We say: This is correct, it may have an effect. So if the one in authority or his representative—such as the municipality, for example, which oversees people’s markets—prohibits such a thing, they have the right to do so. And this would be a matter of regulation and protecting the markets from manipulation.