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The increase paid for delay of payment

Q 1: I bought some sheep fodder from a society on credit. I paid a portion of the price and the rest is to be paid in installments on fixed dates. Those in charge of the society stipulated in the contract that if I delayed the repayment, they would increase the amount by 5%. Is this increase (Part No. 13; Page No. 339) Riba (usury)? It is worth mentioning that they call this additional amount 'indemnity for repayment delay.


A: This condition is Batil (null and void), as it falls under Riba that prevailed during the pre-Islamic days. Whenever the repayment was delayed, the amount used to increase. Thus, this sale is Batil at the very start and you should avoid it. Allah (Exalted be He) says: ...whereas Allâh has permitted trading and forbidden Ribâ (usury). This is a form of Riba. May Allah grant us success. May peace and blessings be upon our Prophet Muhammad, his family, and Companions.


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