What is the ruling on selling by installments if an external party comes forward, pays the price of the commodity in cash to the seller, and then collects the installments from the buyer with an increase? Is this considered usury? And what is the correct Shariah-compliant method for selling by installments between the seller, the buyer, and the third party who pays in cash?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
Selling a commodity by installments is permissible, and the seller is allowed to increase the price in exchange for deferment, and to take guarantees such as a guarantor or collateral. As for a third party paying the price to the buyer in exchange for the buyer repaying him with interest, this is usury (riba), unless the third party genuinely purchases the commodity and it enters into his possession and responsibility, and then sells it to the buyer by installments. In that case, he becomes the creditor.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/107681
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- Ftawy
- Original fatwa ID
- 107681
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- . 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