What is the ruling on one who purchases goods from a bank on installments? And what is the ruling on selling on installments?

The questioner : Another question regarding the car, regarding the Islamic bank. Currently, it is conducting an operation to import goods,

The Shaykh: Yes.

The questioner : It imports the goods and sells them, without seeing them, and without the process of taking possession and delivery being completed...

The Shaykh : And at a price higher than the cash price.

The questioner : Than the cost price.

The Shaykh : No, it is higher than the cash price, because no one buys and sells at the same cost.

The questioner : Yes, he sells at a price higher than the cost price.

The Shaykh : That is my intention. No, my brother, this is not said. There is no person who buys and sells at the cost price, otherwise why would he be selling and buying? Do you understand? Correct your wording to what is intended.

The questioner : I mean, he buys the goods and sells them, of course, at a higher price to the beneficiary here.

The Shaykh : Every trader is like this.

The questioner : Perhaps the picture is not clear. He imports the goods from Europe, and their price to this man in Jordan, if he imported them directly without the bank, would be, for example, one thousand dinars. Then the bank comes and says, I am selling you these goods for one thousand and two hundred dinars, for example.

The Shaykh : My sir, it is known, but you retract your word about selling at a price higher than the cost price.

The questioner : Higher than the cash price...

The Shaykh : Now, I am a trader. I bought a quintal of this grape, and it cost me ten piastres. Is this at the cost price?

The questioner: Yes.

The Shaykh : Well, do I sell it for ten piastres?

The questioner : No, you sell it for more.

The Shaykh : So why are you saying at the cost price? The traders who sell cars sell at two prices...

The questioner : A cash price and an installment price.

The Shaykh : Is there a problem when they sell at the cash price?

The questioner : No, there is no problem.

The Shaykh : But they are not selling at the cost price.

The questioner : Yes, the installment price is usually the one with the problem.

The questioner : But the Islamic bank.

The Shaykh : You are still not following me.

The questioner : The point is, it is impossible, except for a fool among traders, to sell at the cost price.

The Shaykh : Yes, it is not reasonable.

Another questioner: ThisThe Shaykh : It draws your attention to this matter, and I did not notice it.

The questioner : I am withThe Shaykh : in this.

Another questioner : Not withThe Shaykh : Tell him...

The Shaykh : Remove the word "cost."

The questioner : We removed the word "cost."

The Shaykh : A trader sells at one price. In my time, I had watches. I was not a trader, but I had a few watches. What did I sell them for? At one price, the cash price. A watch was stuck with me for forty, and I sold it for forty-five. So is it reasonable that I sell it at the cost price? It cost me forty, and I sell it for forty?

The questioner : No, of course not.

The Shaykh : Well, what does the statement mean when you say you do not sell at the cost price? There is no trader in the world who sells at the cost price. Even if he does not have two prices and only has the cash price, every trader sets a methodology to profit five percent, ten percent, depending on the case. If this profit is the cash profit, it is lawful and is in addition to the cost price. But if he sets an additional price regarding the deferral, that is riba. The price in excess of the cash price.

The questioner : The picture is clear. How am I, why did I mean that I want to import goods through the bank? The bank buys the goods. Look, this is what they call it. The bank buys the goods from abroad and says, I sold you the goods for such an amount. But I am certain that the price of the goods is slightly less than this if I had cash. I could import them directly. So, as for me, I am the buyer from the bank. Now, the bank is a trader. It bought goods from Europe, for example, and gave them to me at a certain price. Do you understand this point that I am unable to comprehend regarding the Islamic bank? It buys goods for me, buys them at one price, and sells them to me at another price.

The Shaykh : What is the difference between the Islamic bank and any company? What is the difference, according to your understanding?

The questioner : No difference regarding the process of buying and selling.

The Shaykh : Why did you specify the Islamic bank?

The questioner : Because the Islamic bank is based on a certain cover, and in contrast to this point, meaning many people consider it to be lawful. I tell you how the Islamic bank bought this for one dinar and sold it to me for one and a half dinars, and I am satisfied. People tell you, I am satisfied with this. And the bank tells you, I am a party. I bought the car, for example, for one thousand dinars, and I want to sell it for one thousand and two hundred. If you want to buy, welcome. If you do not want to, you are free in that.

The Shaykh : I see leaving the Islamic bank aside, because many names change the realities of the named things. When you go to the company and see a car, you ask him, how much is its price? He tells you, cash four thousand, installments four thousand and five hundred. And our friend bought it for four thousand and five hundred. Did this not happen by consent and not by force?

The questioner : By consent.

The Shaykh : Good. So is the justification that makes this sale lawful that it happened by mutual consent?

The questioner : No, of course not.

The Shaykh : Why are you putting the factor of mutual consent regarding dealing with the Islamic bank?

The questioner : The Islamic bank does not set the other condition.

The Shaykh: And that is...

The questioner : That it sold you this much in cash and sold you this much on credit.

The Shaykh : Yes. Yes.

The questioner : Do you see how this is the point? I know...

The Shaykh : Is this what you are not circling around?

The questioner: Yes.

The Shaykh : If the company tells you, its price is four thousand and five hundred on installments, no problem? But if it says cash four thousand and installments four thousand and five hundred. Then something is upon him. So the Islamic bank is distinguished from the company. It directly tells you the installment price, it does not tell you the cash price, because it does not sell in cash. Is this the difference?

The questioner : Yes, it really does not sell in cash.

The Shaykh : I am asking you, is this the difference?

The questioner : No difference, this is the difference, because the one who goes to the Islamic bank does not go to buy in cash. He knows that there is only one way, the way of installments.

The Shaykh : He is coming from the Saudi countries.

The questioner : No, I do not approve. I am not asking and approving. I am asking because I also want...

The Shaykh : I am not saying you approve or do not approve, because this is something that does not concern me. But you are coming from a country that philosophizes the matter with this philosophy.

The Shaykh : No, my brother, the country that philosophizes the matter is Jordan, and there are doctors in this country.

The Shaykh : Also, but there...

Another questioner : The infection came to them.

The questioner : And this speech, if Allah wills, we will hear it from some people whom this infection has affected. I am asking their questions so that the answers reach them. Tell me in your way. They say there is no difference. Why? Because the Islamic bank has only this way, it does not sell you in cash. If it sold you in cash, you would not go to the Islamic bank, you would go directly.

The Shaykh : Look, Professor Islam, you do not know the formalities. It is known by the realities. So now we are dealing with two images of sale. The first image, which is common among large traders, is that they offer you two prices, the cash price and the installment price. Some jurists say, and I do not say some scholars, they say this is not permissible. Is this not what you know?

The questioner: Yes.

The Shaykh : But if the trader says this is four thousand and five hundred on installments, and the sale is concluded on this, it is permissible. But in the first image, if the sale is concluded on this, it is not permissible. Is this not what they say?

The questioner: Yes.

The Shaykh : What is the reason? This is a matter of faith. Allah said on the tongue of His Prophet (peace and blessings be upon him): . Why not six? Why not four? And they should greet with a proper greeting... some have two units, some four, some three. Why... and they should greet with a proper greeting... Is this sale that they are describing, cash for four thousand, and installments for four thousand and five hundred, and the sale was concluded on the installment price, is this permissible? Because the cash price was mentioned. So the second form, where only the installment price is mentioned, is permissible. Is this a matter of faith? Meaning, the text came, either in the Book of Allah or in the hadith of the Messenger of Allah (peace and blessings be upon him), that if the sale is in this second form, mentioning what? One form, which is the installment form, it is permissible. There is no such thing in the Book or in the Sunnah. So this should be taken from the principles of the Shari'ah, if there is no text contradicting it, and this exists with us. We are asking now in the context of understanding the religion. My brothers, what is the difference between the forbidden form and the permissible form? You do not hear from them an answer other than a traditional answer that contradicts reality. They say when the merchant offers two sales, the cash sale, four thousand in our example, and the installment sale for four thousand and five hundred. They say here there is ambiguity in the price. That is what they say. Where is the ambiguity in the price, especially in this age, where there are checks and bonds, and the buyer's address, and the payment percentage each month, and so on? Who says that the price here is unknown? To this day they repeat this statement that some jurists said a very, very long time ago. So distinguishing between the two forms, as Ibn Taymiyyah said in a matter other than this, is a distinction between two identical things. What is the difference? In any case, the car is registered at one hundred and ten in both forms, and it is possible that you also paid cash at one hundred, five percent, ten percent, according to the agreement. Who says this price is unknown? They say the reason for the prohibition is the ambiguity of the price. But when the sale is specified in one form, this is registered as installments of such-and-such, there are not two prices here, so that the seller and the buyer are confused between them. This reasoning is invalidated by correct consideration connected to reality, which is what people are doing today. Any person who buys a car on installments, neither the seller nor the buyer asks at what price I am buying, is it the cash price or the installment price? Is there any hesitation in this?

The questioner: No, there is not.

The Shaykh : So where is the ambiguity of the price that they use to justify the prohibition? It does not exist. But we return and say that this sale is not permissible, not because of the ambiguity of the price, but because of the increase in the price in exchange for patience with your Muslim brother in fulfilling the debt. So this is the reason for the prohibition. And in that case, whether you mention two forms, the cash form or the installment form, or you mention only the installment form, the increase occurs here, and it is riba, as he (peace and blessings be upon him) said: . What do some people say who find it difficult to accept this ruling, especially when they hear, as you said, and doctors, a doctorate in Shari'ah, may Allah will it, they issue this fatwa? What do some people say? They say, my brother, the profit is limited? We say to them, simply and easily, no, it is not limited. Okay, I want to sell to a person named Zayd cash for four thousand and on installments for four thousand and five hundred, or one hundred, or two hundred, whatever it is. We ask him: Have you ever sold to a person you do not know at the cash price, not to the one who is buying from you on installments? Because the profit is not limited. He has never done it in his life, not at all. He does not do it except for the one who buys on installments. If actions are by intentions, you are taking the increase, not like a person who says this car is one hundred dinars cash, and another person comes and says it is one hundred and fifty. This is what we say about the profit not being limited. Of course, here it is required that you do not deceive the buyer, you do not tell him that the capital is more than this, which is what usually comes out of people. So when we say, by Allah, the profit is not limited, but you are exploiting this rule and applying it and placing it in a place other than its place. Have you ever applied this rule for the one who buys from you on installments and took from him the cash price? No, on the contrary, there you raised the price. But for the one who pays you cash, you do not raise the price for him. Why? Are you not free? Yes, you are free here and you are not free there. This is manipulation.

The questioner : Okay, regarding the other matter