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A loan whose interest is paid by another party

قرض بفائدة تدفعها جهة أخرى

A question about a loan whose interest is paid by another party, in which Jordan's General Iftaa Department answered that any loan repaid with a stipulated increase is an interest-bearing loan whether the borrower or someone else pays the increase, so one may not sign an interest-bearing loan even if another institution bears the interest, since the contract is void. The Department answered that any loan repaid with a stipulated increase counts as an interest-bearing loan, whether the increase is paid by the borrower or someone else, since jurists agree on the well-known maxim that every loan that brings a benefit is riba. It said there is no Shari'a justification for a Muslim to sign an interest-bearing loan contract whose interest someone else pays, because an interest-bearing loan contract is void, citing Surat al-Baqara 2:278 and 2:279. It concluded that taking an interest-bearing loan is not permitted even if another body pays the interest, because a loan contract that stipulates interest is void in the Shari'a.

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A question about a loan whose interest is paid by another party, in which Jordan's General Iftaa Department answered that any loan repaid with a stipulated increase is an interest-bearing loan whether the borrower or someone else pays the increase, so one may not sign an interest-bearing loan even if another institution bears the interest, since the contract is void. 1

The question

The questioner asked about taking a loan in which he repays the same amount he received, but signs a contract carrying interest that is paid by an institution affiliated with the education sector. 1

The answer

The Department answered that any loan repaid with a stipulated increase counts as an interest-bearing loan, whether the increase is paid by the borrower or someone else, since jurists agree on the well-known maxim that every loan that brings a benefit is riba. 1 It said there is no Shari'a justification for a Muslim to sign an interest-bearing loan contract whose interest someone else pays, because an interest-bearing loan contract is void, citing Surat al-Baqara 2:278 and 2:279. 1 It concluded that taking an interest-bearing loan is not permitted even if another body pays the interest, because a loan contract that stipulates interest is void in the Shari'a. 1

About this record

Jordan's General Iftaa Department published this fatwa on aliftaa.jo as no. 3657, dated 14 November 2021. 1 The museum records this text as a historical document attributed to the body or scholar that issued it; it issues no ruling of its own.

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Riba in the rulings: the forbidden excess in exchange and in delay, its kinds, its causes and its rulings

People and things also explored

A charity accepting a commercial bank's support in return for thanking it in posts· Administrative fees on an interest-free loan card· Arranged invoices to obtain cash from Islamic banks· Buying an online game account in instalments· Buying gold bars through an app· Court-awarded legal interest· Financing a Ramadan iftar invitation in instalments· Bank instalment financing for hajj and umrah trips

Sources

  1. Jordan's General Iftaa Department (aliftaa.jo) , fatwa 3657

Original page

Cite this page

islam.museum contributors. “A loan whose interest is paid by another party”. islam.museum, https://islam.museum/en/work/fatwa-aliftaa-jo-a-loan-whose-interest-is-paid-by-another-party/. CC BY-SA 4.0. Last updated 2026-11-02.

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A charity accepting a commercial bank's support in return for thanking it in posts

A question about a charity accepting support from a commercial bank in return for thanking it in posts, videos and advertisements, in which Jordan's General Iftaa Department answered that donations from interest-based banks may be accepted if no promotion is required, that thanks given orally or by letter are fine, and that thanks through advertisements and posts are forbidden because they amount to promotion. The Department answered that promoting and advertising banks and financial institutions that deal in usury is forbidden, because it is assisting in what is forbidden. It said there is no objection to dealing with someone whose wealth is mixed between lawful and unlawful, or even mostly unlawful, so his gift or donation may be accepted unless the specific money given is known to be unlawful, provided this is not tied to promoting the donor; it quoted Ibn Hajar al-Haytami's answer in al-Fatawa al-Fiqhiyya al-Kubra that dealing with someone most of whose wealth is unlawful is disliked unless the unlawful item itself is known. It distinguished ways of thanking a supporting bank: oral thanks to its management, or a letter of thanks, are unobjectionable; thanks published in advertisements and videos are not permitted, because they amount to promotion. It concluded that donations from interest-based banks may be accepted if they do not require promotion, but are forbidden if given in return for promotional work, such as thanks in posts and advertisements.