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Can I Offer an Incentive When I’m Seeking a Loan?

Answered by Shaykh Faraz A. Khan

Question: What is a halal form of offering incentive to a loaner when requesting a loan. I am a small business owner seeking to purchase a building/shop and I am in need of start up money. Everyone is interested in investing in exchange for a continuous percentage of profit. I am more interested in one-time loans, but I do not know the best way to present it to them in a way they feel benefits them.

 

Answer: Assalamu alaikum wa rahmatullah,

I pray this finds you in the best of health and states.

In Islam, a loan is considered a type of charity, that is to say, no benefit can be attached to it. One simply lends a particular amount of money, and then takes back that same amount of money upon the due date.

There can be no worldly incentive associated with the contract; the only incentive that can be offered is otherworldly, i.e., reward in the next life. Many Companions are reported to have said, “Any loan that comes with a benefit is a form of usury.” [Bayhaqi, Sunan Saghir]

Having said that, the otherworldly incentive is huge. A person who seeks a loan is often in grief or difficulty, and our Beloved Messenger (peace and blessings be upon him) said, “Whoever relieves a believer from a worldly grief, Allah will relieve for him one of the griefs of the Day of Judgment. Whoever provides ease to a person in difficulty, Allah will provide him ease in this world and the next… Allah continues to aid the servant so long as the servant aids his brother.” [Muslim]

Please also see this related answer, specifically dealing with the reward of giving a loan:

Loans Entailing More Reward than Charity and the Validity of an Estate’s Executor Being a Beneficiary in the Will

Finally, one could consider using Islamic alternatives such as financing mechanisms predicated upon profit and loss sharing, such as joint partnership (sharika/musharaka) and silent partnership [of capital and labor] (mudaraba). For more detail, please see An Introduction to Islamic Finance by Mufti Taqi Usmani.

And Allah knows best.
wassalam
Faraz

Checked & Approved by Faraz Rabbani

A Meeting with a Great Scholar of This Age: Mufti Taqi Usmani by Ustadh Abdullah Anik Misra

A Meeting with a Great Scholar of This Age: Mufti Taqi Usmani by Ustadh Abdullah Anik Misra

Last night, six members of the Seekers Guidance team who reside in Amman, Jordan had the opportunity to meet Shaykh Mufti Taqi ‘Uthmani. Considered by many people of knowledge to be one of the foremost scholars of our age, and especially known for his pioneering work in the field of Islamic Finance, the shaykh was visiting Amman to attend a conference of scholars regarding Islam and the Environment. Other scholars that the group had the chance of greeting that night included Shaykh Yusuf Qaradawi, Shaykh Abdullah bin Bayyah and Dr. Ingrid Mattson.

After some hours of anxious waiting, we had the chance to spend a few minutes with Mufti Taqi Uthmani in the lobby of his hotel after the day’s proceedings. Being aspiring students of knowledge, we asked what advice he had for those seeking to study the Islamic sacred sciences. He responded in Arabic, to the effect that:

1) Sacred knowledge is of no use or benefit to the aspiring student unless they act upon their knowledge and bases their works upon it. And the most beneficial of works is that which brings one closer to the obedience of Allah Most High.

2) A student must purify their intention as to why they are seeking knowledge. Their intention must be purely and sincerely for the sake of Allah Most High.

3) A student should firmly adhere to the Sunnah (life-example) of the Prophet Muhammad (peace and blessings be upon him) in every aspect and circumstance of their life.

4) A student must be constantly turning back to Allah Most High through their life journey, in all situations. Returning means to seek help from Allah against all difficulties and challenges, to seek to please Him, to seek protection and forgiveness from Him, and to be grateful and humble to Him.

5) A student of knowledge must be make lots of supplication (dua’) to Allah Most High, for every single one of his needs, whether they be needs of this world or the next.

Then, the Shaykh answered two questions briefly and returned to his room to rest for the next day’s events. We noticed how the greatest of scholars such as Mufti Taqi always gave the most comprehensive advice when asked, which was most relevant to everyone and reflected their deep wisdom. We were thankful for the opportunity to meet this erudite and wise scholar of our times, even if it was for a short time, and we hope that we can all act on these advices. We ask Allah Most High to bless all of the students of knowledge and give us tawfiq and sincerity.


Ustadh Anik Abdullah Misra is currently teaching Meccan Dawn: The Life of the Beloved Prophet Muhammad at SeekersGuidance this semester.

Mufti Taqi Usmani – On Using Time Appropriately

ASHRAFIYA » Blog Archive » Using Time appropriately

This is advice Mufti Taqi Usmani gave someone seeking counsel:

The Shaykh told him:

“Recognize the importance of time. That it is an invaluable wealth. Spend it very wisely and precisely in virtuous actions.”

Next day while the Shaykh was sitting in Masjid al-Haraam facing the holy Kab’a (‘s Rukun-e-Yamani) an individual requested some elaboration on this advice. That is, as how to practically incorporate it in to one’s daily life.

Obviously pleased on the question, Shaykh replied;

“Firstly one has to recognize the importance of time per se.

Secondly, one has to organize one’s schedule to fully maximize the benefit of available time, such that not a single moment is wasted. Being wasted meaning that it is not utilized appropriately even for a worldly purpose, may it be sleeping or moderate lawful entertainment or being busy in helping another fulfill his essential obligations, etc.

Wasting time includes indulging in activities having no benefit for this life or here-after (akhira).”

The Shaykh continued:

“Develop the habit of planning.

That is, plan for the future.

If I was to get 5 or 10 minutes break between my tasks how will I spend it?

For example, while commuting to work.

Think and decide in advance.

How I am going to spend these 15 minutes besides doing the driving?

Only if one has thought of these in advance he will be able to utilize this time appropriately.

My father (Grand Mufti of Pakistan, Hazrat Mawala Mohammad Shafi’i ra) used to inform us that, “Even the time I spent in toilet I try to make use of it. If there is nothing else I scrub and clean the water jug (lota) kept in there.”

All praise to Allah, due to his training I also try to enact on this advice. When I come home from my classes I know there will be at least a 5 minute interval before the lunch is served. I have planned in advance the use of this time. Such as, to return someone’s telephone call, etc.

When a person develops this habit of utilizing the time precisely, Allah facilitates immense actions for him and also puts blessing (barakh) in time. (That is, in short duration a lot is achieved.)

Remember, heedlessness (gaflah) is a bane!”

Makkah e mukarramah, November, 7th 2005