What is the ruling on the daily increasing addition to the amount owed to the contractor in the event of delay in monthly payments? Is this increase considered usury (riba)? And what is the legitimate alternative formula that guarantees the rights of both parties and avoids falling into usury?

It is not permissible to enter into a contract that includes a forbidden condition, such as a penalty clause for late payment of a debt, whether the delay is excusable or not, and whether the origin of the debt is a loan, a sale, or a lease. The International Islamic Fiqh Academy has stipulated that a penalty clause is not permissible in contracts where the original obligation is a debt, as it constitutes explicit usury (riba). An agreement can be made with the contractor to provide collateral from which the worker can claim his right in case the employer procrastinates, or to bring a guarantor and a surety.