Charging a profit on a loan

Q. Can you charge a profit on a loan?

A. In Shariah, if a debtor takes a loan from a creditor whereby it is agreed that the debtor will pay back the creditor at a later date with an additional amount or rate, it will be tantamount to interest.

Therefore, it is impermissible and Haraam to charge a profit on a loan.

Allah Ta’ala Knows Best

Mufti Ismaeel Bassa

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