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The question

Is the government's purchase of equipment necessary for a construction engineer's project, and its payment in installments months after the project's start with a 5% interest, considered usury (riba)?

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Source: FtawySummarized from the full answer at Ftawy · imported Sep 2, 20261 min readAlso available in العربية
The answer

If the transaction between the certificate holder and the entity that employs him is a sale and purchase of equipment at a specified price, then there is no harm in that, even if the price is higher than the value of the equipment, because time has a share in the price, and selling in installments differs from selling in cash. So, if the surplus (5%) means that the entity sells the materials with a 5% profit margin, then this is permissible. However, if the transaction is a grant of the equipment's price followed by its repayment with interest, then this is prohibited usury (riba) and is impermissible.

Summarized from the full answer at Ftawy · imported

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Source platform
Ftawy
Original fatwa ID
117919
Imported
Translation status
Source text, unreviewed
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