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What is the ruling on a merchant selling an item in installments to a friend of the seller if the seller’s friend is present at the sale or knows its price, and what is the difference between this transaction and a real sale and the sales of banks?

1 min readAlso available in العربية

If you buy a commodity, take possession of it, and then sell it for a deferred price higher than the price at which you bought it, this transaction is permissible and is called Murabaha to the one who commands the purchase. However, if the purchase is not real and the commodity has not entered into your possession, and then you sell it to another person, this is a forbidden usurious transaction, because in reality, it is a loan with a usurious increase. The difference between a real and a fictitious purchase is the transfer of the commodity to the ownership of the buyer and their guarantee in the former, whereas in the latter, it does not transfer, and the intention is to circumvent to reach usury.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

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