The correct way of loaning others money


Question: Many people loan one another money without [contractually] writing anything; thereafter, problems occur between them along with the loss of one’s right – the extent of which only Allaah truly knows. So what is your advice [to the people]?

Response: Allaah Jalla wa ‘Alaa says:

{O you who believe! When you contract a debt for a fixed period, write it down. Let a scribe write it down in justice between you.}, soorah al-Baqarah, aayah 282

[…and] He then says:

{You should not become weary to write it (your contract), whether it be small or big, for its fixed term, that is more just with Allaah; more solid as evidence…}, soorah al-Baqarah, aayah 282

As for [a contract of] buying and selling that which is in front of them, and there being no delay [in payment nor receipt of the goods or services, then Allaah ‘Azza wa Jall said]:

{…except when it is a present trade which you carry out on the spot among yourselves, then there is no sin on you if you do not write it down.}, soorah al-Baqarah, aayah 282

As for [a transaction] where there is a delay [in receiving the goods or services], then it is imperative that [the contract] is put in writing, so as not to forget, or the one who has [received] a loan does not deny he has [received] it. If there is a contract, then you will not have such a denial, [because] having [a contract] protects your right; and if you do not write [anything down], then you are careless and negligent.

He is a graduate of the Islaamic University of Madeenah, having graduated from the Institute of Arabic Language, and later the Faculty of Sharee'ah in 2004. He currently resides in Birmingham, UK.

Related posts