What is the ruling on an agreement in which 5,0 Euros are paid to a friend to purchase and use a car, provided that the latter pays 10 Euros daily for 6 months, then returns the principal while keeping the car, and is this permissible if the profit is at a common rate with the same conditions for the return of the principal and the ownership of the car?

This transaction can be summarized in two forms:

First: You purchase the car for the operator, and you receive the money back, not the car, with a daily increase. This is an interest-based loan and is forbidden.

Second: You purchase the car and authorize the operator to use it for a fixed daily amount. This is a void Mudarabah (definition) (profit-sharing partnership) because the profit is a fixed amount, not a percentage, and the capital is not guaranteed.

How to correct the transaction:

1. Agree on a common percentage of the profit (such as one-third or one-half) for you from the revenue, and the car remains your property. 2. You rent the car to him for 10 Euros daily, and its maintenance is your responsibility. The lessee is only liable in cases of transgression or negligence. It is permissible to sell the car to the lessee after the rental period ends or to promise him that.

Conclusion: It is not permissible for the car to be owned by the operator from the outset with his commitment to return its price (an interest-based loan). If the car is your property, it is permissible to give it to someone to operate it for a percentage of its revenue, or to rent it to him for a known period at a known rent, after which the car is returned in its original condition.