The Ruling on Lending Money with the Condition of Taking Half the Profits
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His Eminence the Shaykh: A man borrowed money from another on the condition that he would take half of the profit that the borrower would receive. Is this permissible, may Allah reward you?
A man borrowed money from a person to trade with it, on the condition that the lender would have half the profit. This is forbidden and not permissible;Because the established rule among the scholars of knowledge: every loan that brings a benefit is riba (usury or interest),But better than that is to say: "Take this money, trade with it, and you will have half the profit."If someone says: What is the difference between this and that? Now we understand that if he lent him ten thousand riyals and said: "This is ten thousand riyals as a loan, on the condition that I have half the profit."
Answer: Is it forbidden or lawful? It is forbidden; because it is a loan that brought a benefit.
But if he said: "Take ten thousand, trade with it, and you will have half the profit?" Is it lawful? What is the difference? The difference is that in the loan, if the money is lost, the loss falls on the borrower; because he borrowed ten thousand and ten thousand became established in his liability,But in the issue of partnership (mudarabah), if he says: "Take ten thousand, trade with it, and you will have half the profit." If the money is lost or destroyed, that falls on the partner (mudarib) who paid the money.
And there is no detail other than what I said,A man lent money, ten thousand riyals, and said: "Trade with it and I will have half the profit." The man traded with the money and lost it or it was destroyed. Who guarantees the ten thousand? The same borrower. He pays ten thousand to the one who lent it to him.
The second issue: He gave him ten thousand and said: "Take these ten thousand as a partnership (mudarabah), trade with it, and you will have half the profit." Then, if Allah decrees that this money burns, on whom does it fall? On the owner of the money. And this is a clear difference.
A man borrowed money from a person to trade with it, on the condition that the lender would have half the profit. This is forbidden and not permissible;Because the established rule among the scholars of knowledge: every loan that brings a benefit is riba (usury or interest),But better than that is to say: "Take this money, trade with it, and you will have half the profit."If someone says: What is the difference between this and that? Now we understand that if he lent him ten thousand riyals and said: "This is ten thousand riyals as a loan, on the condition that I have half the profit."
Answer: Is it forbidden or lawful? It is forbidden; because it is a loan that brought a benefit.
But if he said: "Take ten thousand, trade with it, and you will have half the profit?" Is it lawful? What is the difference? The difference is that in the loan, if the money is lost, the loss falls on the borrower; because he borrowed ten thousand and ten thousand became established in his liability,But in the issue of partnership (mudarabah), if he says: "Take ten thousand, trade with it, and you will have half the profit." If the money is lost or destroyed, that falls on the partner (mudarib) who paid the money.
And there is no detail other than what I said,A man lent money, ten thousand riyals, and said: "Trade with it and I will have half the profit." The man traded with the money and lost it or it was destroyed. Who guarantees the ten thousand? The same borrower. He pays ten thousand to the one who lent it to him.
The second issue: He gave him ten thousand and said: "Take these ten thousand as a partnership (mudarabah), trade with it, and you will have half the profit." Then, if Allah decrees that this money burns, on whom does it fall? On the owner of the money. And this is a clear difference.