Answered by Shaykh Farid Dingle
Question: Assalamu alaykum
I have a business idea in mind.
My company will offer a unique service to citizens who uses public transportation facilities of the country.
In general, the citizens should buy a travel ticket in
order to use the public transportation facility. If found travelling
without a ticket, a penalty will be charged. If the customer
subscribes to the company’s service, the company would incur the
‘penalty charges’ paid by the customer in the event of ‘getting caught
travelling without having a ticket’.
Is it Haram?
Answer: Wa alaykum assalam wa rahmatullahi wa barakatuh,
The Prophet (Allah bless him and grant him peace) forbade unclear contracts. [Muslim and others]
In this contract, assuming the registration/subscription fee is known, the service is still unknown. It is based on an ‘if then’ criteria: only if the customer should incur a fine, will the company provide the monetary service of footing the bill. This would make the contract impermissible.
Besides this, the contract also involves debt factoring: selling one debt for another. The customer is essentially selling his debt to the state (the fine) to the company. This also makes the contract impermissible.
There may be other problems too, but in short it does not seem permissible at all.
I pray this helps.
[Shaykh] Farid Dingle
Shaykh Farid Dingle grew up in a convert family in Herefordshire, UK. In 2007, he moved to Jordan to pursue traditional studies. Shaykh Farid continues to live in Amman, Jordan with his wife and kids. In addition to continuing his studies he teaches Arabic and several of the Islamic sciences.
Shaykh Farid began his journey in sacred knowledge with intensives in the UK and Jordan (2004) in Shafi’i fiqh and Arabic. After years of studying Arabic grammar, Shafi’i fiqh, hadith, legal methodology (usul al-fiqh) and tafsir, Sh. Farid began specializing in Arabic language and literature. Sh. Farid studied Pre-Islamic poetry, Umayyad, Abbasid, Fatimid, and Andalusian literature. He holds a BA in Arabic Language and Literature and continues exploring the language of the Islamic tradition.
In addition to his interest in the Arabic language Shaykh Farid actively researches matters related to jurisprudence (fiqh) which he studied with Shaykh Hamza Karamali, Shaykh Ahmad Hasanat, and continues with Shaykh Amjad Rasheed.