Who Can I Borrow Money From?

Question

From whom can a Muslim borrow money? Can I borrow money from a Muslim who consults a priest of another religion and does rituals to succeed in their business if there is no one else to ask for money?

Answer

In the Name of Allah, the Most Merciful and Compassionate.

May salutations descend upon the Prophet (may Allah bless him and give him peace). May Allah forgive our shortcomings and guide us to actions that please Him. Amin.

According to the Sacred Law regulations, a Muslim may borrow (take a loan) from anyone willing to offer the loan as described by the Law. [Nawawi, Majmu‘]

You may borrow from someone who engages in sinful actions because you are not duty-bound for their actions, though it would be best not to deal with the described sinner and instead advise him to refrain from sinning, and Allah knows best.

Rules on Loans

Definition: A Loan means repayable financial aid. It does not refer to lending a particular article (‘ayn) for someone to use and then return after use, which is termed an ‘ariyya. [Nawawi, Majmu‘]

General Ruling: Loaning (meaning to give something to the borrower on the basis that he will return its equal) is recommended. [ibid.]

The Agreement: A loan is effected through a spoken offer and acceptance, such as saying, “I loan you this,” or, “I advance it to you.” [ibid.]

Valid Loan Contents: It is permissible to give as a personal loan any article that may be brought in advance and nothing else, though this restriction does not apply to lending for use (‘ariyya)

Stipulating a Repayment Date: It is not permissible for the lender to impose as a condition that the loan be repaid on a specific date. However, for the Maliki School, stipulating that repayment is obligatory on a specific date is valid and legally binding. [Keller, Reliance of the Traveller]

Benefiting from the Loan: It is not permissible for the lender to impose some condition that will enable him to benefit from the loan, such as a condition that the borrower must return superior to what was loaned, or such as saying, “on condition that you sell me your horse for such and such an amount,” for these are usurious gain (riba). But it is permissible for the borrowers to return superior to what was loaned without this being stipulated. [Nawawi, Majmu‘]

Valid Conditions – Collateral and Guarantors: It is permissible for the loan agreement to include the condition of collateral (meaning for the recipient to give the lender something as collateral for what he borrows) or the condition of a guarantor, such that the recipient brings someone to guarantee that the loan will be repaid. [ibid.]

Repayment Rules: The recipient of a loan is obliged to repay the equal of what was lent, though it is permissible for the lender to accept something other than the type of thing loaned. Suppose the lender gives the recipient a loan, meets him in another town, and asks for it back. In that case, the recipient must repay it if it is gold or silver, etc. However, if the loaned commodity was troublesome to carry, such as wheat or barley, then the recipient is not obliged to pay it back in kind but merely to pay back its value. [ibid.]

I pray that this benefits and that Allah guides us always.
[Shaykh] Irshaad Sedick
Checked and Approved by Shaykh Faraz Rabbani

Shaykh Irshaad Sedick was raised in South Africa in a traditional Muslim family. He graduated from Dar al-Ulum al-Arabiyyah al-Islamiyyah in Strand, Western Cape, under the guidance of the late world-renowned scholar Shaykh Taha Karaan.

Shaykh Irshaad received Ijaza from many luminaries of the Islamic world, including Shaykh Taha Karaan, Mawlana Yusuf Karaan, and Mawlana Abdul Hafeez Makki, among others.

He is the author of the text “The Musnad of Ahmad ibn Hanbal: A Hujjah or not?” He has served as the Director of the Discover Islam Centre and Al Jeem Foundation. For the last five years till present, he has served as the Khatib of Masjid Ar-Rashideen, Mowbray, Cape Town.

Shaykh Irshaad has thirteen years of teaching experience at some of the leading Islamic institutes in Cape Town). He is currently building an Islamic online learning and media platform called ‘Isnad Academy’ and has completed his Master’s degree in the study of Islam at the University of Johannesburg. He has a keen interest in healthy living and fitness.