Is it permissible to work for a debt collection company that buys overdue debts and collects, in addition to the principal, late payment fees and litigation costs, and if it is not permissible, is it allowed to continue working until an alternative is found?
Source: FtawySummary from Ftawy's records · added here Sep 2, 2026
If the company purchases debts for a percentage it takes upon collecting the debt, this is selling debt for debt to someone other than the debtor, which is invalid by consensus. Moreover, it involves riba al-fadl (usury of surplus) and riba an-nasi'ah (usury of delay). As for selling debt for something other than debt, there is a difference of opinion among scholars. The system that imposes an increase on the debtor due to delay is impermissible. It is permissible to take litigation expenses to recover the debt from the procrastinator. It is advisable not to continue working for this company.
Summary from Ftawy's records · added here
Reviewed by El Fatwa's sharia committee.
Read the full answer on Ftawyhttps://ftawy.com/en/questions/82943
Where this answer came from
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- Ftawy
- Original fatwa ID
- 82943
- 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