To what extent is the car installment system legitimate under the Murabaha financing arrangement from an Islamic bank, where the customer chooses the car and provides its price offer, then the bank pays its price to the dealership, and the customer directly receives it in their name, with it being mortgaged for the installments and not permissible to dispose of it except by consulting the bank, along with the fixed interest rate?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
The mentioned transaction is nothing but an usurious loan, unless the bank genuinely owns the car before selling it to you, such that it enters into its guarantee. The fact that the interest does not increase with late payment does not change the ruling in any way.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/152534
Where this answer came from
- Source platform
- Ftawy
- Original fatwa ID
- 152534
- Added here
- . This is when the answer was added to El Fatwa, not the fatwa's date.
- Text
- Summary from Ftawy's records, reviewed by El Fatwa's sharia committee.
- Read the full ruling
- Read the full answer on Ftawy