What is the ruling on sale by installment?

The questioner : On Thursday night, the night before Friday, I was in a gathering. Briefly, someone spoke on your behalf, saying, "I went to..."The Shaykh : ...Nasser, and he issued a fatwa to me that sale by installment is forbidden. I said to him, "My brother, I answered him as follows: I told him, 'This is a fatwa, and I hope you fear Allah in it. Sale by installment—perhaps you did not give the Shaykh the correct question. If I came to him and said, "How much is this house?" He said to me..."The Shaykh : ...and I said to him, "How much is this house?" He said to me...The Shaykh : I gave him an example of a thousand dinars. I said, "By Allah, my Shaykh, I do not have the means to pay you anything other than five hundred, and you should install the rest for me, one hundred at a time. I do not think this is..."The Shaykh : ...forbidden. But if I said to him, "For this..."The Shaykh : ...this house is a thousand. So when he knew...The Shaykh : ...that I did not have the thousand, he said to me, "This house is a thousand and two hundred instead of a thousand." This is forbidden. So I do not know if this scenario was presented this way, or if the scenario of sale by installment that you forbade entirely was different?

The Shaykh : The one who said it is truthful, and the one who conveyed to you that I forbid sale by installment entirely is truthful. And the detail I mentioned, if you understood it, is unreasonable, neither by Shari'ah nor by reason. And I see you mention reason often, because the truth is that the rulings of the Shari'ah cannot be understood except by reason. So what is the difference between this scenario which is permissible and the scenario which is permissible? There is no difference except a purely formal one. In the sense that if someone says, "This recorder is one hundred dinars cash, and one hundred and ten dinars on credit," why is this not permissible? And if he says from the start, "This recorder is one hundred and ten on installment," it is permissible. What is the difference between this scenario and that one? And what is the wisdom in distinguishing between them?

The questioner : The answer, if you please.

The Shaykh: Go ahead.

The questioner : I came to you and said, "This recorder is one hundred dinars." I said to you, "I will pay you fifty and you install the rest for me." This scenario, meaning if I came to you with this hundred, this is fifty and you install the fifty for me, I give you ten dinars every month. Is this scenario forbidden?

The Shaykh : There is no prohibition in this.

The questioner : So what is forbidden? The prohibition occurs if I came to you directly and said, "This is two hundred dinars on installment." Meaning, if I came and you directly answered me, "How much is this item?" You said to me, "Two hundred dinars on installment." So what is the aspect of prohibition in it? You directly said to me, "Two hundred dinars on installment." We did not agree on the item, meaning you directly gave me the price without us saying: one hundred and one hundred and twenty, two hundred. You said to me, "Installment..."

The Shaykh : This is what I said earlier: what is the difference between this scenario and this scenario? And now we proceed in understanding. A recorder, you say, is two hundred on installment. You, the seller, said this.

The questioner: Yes.

The Shaykh : I said to you, "Okay, how much is it in cash?" You said to me, "Two hundred minus ten." Then after that, I bought it either in cash or on credit. Is this permissible or not?

The questioner : Of course, if you allow me, according to what some jurists say...

The Shaykh : No, let me, and what do they say? Say what you want to say.

The questioner : I, through juristic comparison, do not accept that, because riba (usury or interest) would have entered.

The Shaykh : Good, that is what that man conveyed to you.

The questioner : No, he conveyed the first scenario, so I discussed it with him. I said, "If I came to a shop, the scenario that the man conveyed from you, I said, 'Please verify it,' meaning he conveyed the direct scenario, because I came to Abu Ahmad, and Abu Ahmad knows that I do not have the price. He knows in advance that I do not have the price."

The Shaykh : This is the problem.

The questioner : He said to me directly, "Not cash, and not..." He said to me, "I will install these two hundred for you." We did not agree on cash...

The Shaykh : My brother, this scenario is the same one. This is the one who came to Abu Zayd al-Hilali, not Abu Ahmad, and Abu Zayd al-Hilali knows that the customer coming has no money and wants to buy in cash. And this seller usually sells at two prices: the cash price and the installment price. So when the man came to Abu Zayd and Abu Zayd knew that he wanted to buy on installment, he gave him the installment price.

The questioner : Immediately.

The Shaykh : This is not permissible because he took an increase in the price in exchange for patience in fulfilling the obligation to his Muslim brother. And this is what, when I verified with you and said to you, "Leave what they say, say what you see," you said, "You think this is from the category of riba (usury or interest)." So the issue is not a formal one, that he mentioned two prices: cash at such-and-such and installment at such-and-such. This is not permissible. But if he mentioned only the installment price, this is permissible. This is a purely formal distinction that no jurist and rational person would say, because when he says "cash for one hundred and installment for one hundred and ten," it is understood that he took the ten in exchange for what? The debt, right?

The questioner: Correct.

The Shaykh : Okay, the value of the cash price was not mentioned. He mentioned the value of the installment price immediately, just as that man told you. He mentioned the installment price immediately, meaning one hundred and ten. So if he were asked, "Okay, how much is it in cash?" He would say to him, "One hundred." Therefore, the scenario that was conveyed to you is a correct scenario after you clarified that Abu Zayd knows that this person is coming and does not have money.

The questioner: Correct.

The Shaykh : So he will present him with the installment price, meaning if he asks for the cash price plus the installment price.
And here we say, on this occasion, those who sell on installment will make three profits, or two profits. First, they make the cash profit, which is lawful. Let us assume, for example, that a person has a profit program. He says, "I want to make ten percent on the hundred, that is enough for me. But on installment, I want fifteen percent." So the one who sells on installment makes two profits: the cash profit, which is ten percent, and the installment profit, which is an extra five percent. So he makes fifteen percent. This increase is in exchange for what? In exchange for patience with him. And this is not permissible. This is exploiting the need of the Muslim. This is enough, and praise be to Allah, Lord of the worlds. Oh Allah, who is going to call the adhan (the call to prayer)?

The questioner : Imam al-Shawkani, in this field, perhaps you have looked into it...
The student : Al-Shawkani, in *al-Sayl al-Jarrar*, seems to lean toward prohibition...

The questioner : He has a treatise on that...

The Shaykh : I have heard of this treatise, yes. In *al-Sayl al-Jarrar*, I have not read it...
The student : In *al-Sayl al-Jarrar*, his words, I read them yesterday, strongly indicate prohibition...
The Adhan
The student : He says: "I say: Evidence can be cited for this prohibition."

The Shaykh : Does he mention this in the permissible or the forbidden?
The student : In the forbidden; "Evidence can be cited for this prohibition by what Ahmad, al-Nasa'i, and al-Tirmidhi narrated, and al-Tirmidhi graded it authentic, from the hadith of Abu Hurayrah, who said: The Messenger of Allah (peace and blessings be upon him) said: , and by what Ahmad, al-Bazzar, and al-Tabarani in the *Kabir* and *Awsat* narrated from Sammak from Abd al-Rahman" from Sammak ibn Abd al-Rahman, of course?

The Shaykh : Sammak ibn Abd al-Rahman ibn Mas'ud
The student : Yes, "Ibn Abdullah ibn Mas'ud, from his father, who said: The Prophet (peace and blessings be upon him) forbade two transactions in one transaction. Sammak said: It is the man who sells and says, 'It is such-and-such on credit, and such-and-such in cash.' He said in *Majma' al-Zawa'id*: The men of Ahmad's chain are trustworthy. So these two hadiths indicate that the increase for the sake of credit is prohibited. And for this he said: , and the items that are not subject to riba are included in the generality of the two hadiths. And I have separated this research in an independent treatise which I named *Shifa' al-'Ullal fi Hukm Ziyadat al-Thaman li-Ajli al-Ajl* (The Cure of Diseases in the Ruling on Increasing the Price for the Sake of the Term). And the discussion in this place is long. And the majority have gone to the permissibility of selling a thing for more than its price of the day for the sake of credit, and they disputed the indication of the two mentioned hadiths regarding the point of dispute."
What does this statement indicate, our professor?

The Shaykh : It indicates prohibition, but in the end, he muddled it. The majority...