Is it permissible for the one who loans money to ask for his money prematurely in return for decreasing the debt amount?

هل يجوز للدائن أن يعجل رد الدين قبل موعده مقابل إسقاط بعض الدين؟

In Islamic finance, it is permissible for a creditor and debtor to agree to reduce the total debt amount in exchange for early repayment. This arrangement is lawful provided it is done with mutual consent, as it brings relief and benefit to both parties without involving any forbidden interest.

في المعاملات المالية الإسلامية، يجوز للدائن والمدين الاتفاق على تخفيض إجمالي مبلغ الدين مقابل السداد المبكر. هذا الترتيب مشروع بشرط أن يتم بالتراضي، لأنه يجلب الراحة والمنفعة لكلا الطرفين دون التورط في أي فائدة محرمة.

Islamic law promotes ease in financial dealings, allowing flexibility that helps debtors clear their liabilities while ensuring creditors can recover their funds promptly.

تشجع الشريعة الإسلامية على التيسير في المعاملات المالية، وتسمح بالمرونة التي تساعد المدينين على تصفية التزاماتهم مع ضمان تمكن الدائنين من استرداد أموالهم بسرعة.

Early Repayment and Discounting | تعجيل السداد وإسقاط الدين

1. Permissibility and Mutual Benefit
Yes, the creditor may expedite the debt before its maturity by decreasing the debt amount, so that both the creditor benefits from getting his money back, and the borrower gets an early release of paying back the debt, provided that the creditor is satisfied.
1. الجواز والمنفعة المتبادلة
نعم، يجوز للدائن أن يعجل الدين قبل موعده مع إسقاط بعض الدين، فينتفع الدائن بتعجيل حقه، والمدين ببراءة ذمته، بشرط أن يرضى الدائن.

2. The Scholarly Precedent of Ibn Abbas
Ibn Abbas, the great scholar of the Ummah, was asked about a man who has loaned someone money for a fixed term, and he says to him: "Expedite the debt payment and I will write off a certain amount of the loan." He replied, "It is permissible." Narrated by Abd al-Razzaq with an authentic chain: 14360.
2. سابقة الإمام ابن عباس
فقد سئل ابن عباس حبر الأمة عن الرجل يكون له الحق على الرجل إلى أجل، فيقول عجل لي وأضع عنك، فقال لا بأس بذلك. رواه عبد الرزاق بإسناد صحيح: 14360.

Scholarly Insight: In Islamic Jurisprudence (Fiqh), this financial arrangement is famously known as Da' wa Ta'ajjal (reduce and expedite). It is highly supported by the Hanbali school of thought and prominent companions like Ibn Abbas. Scholars explain that this practice is the exact opposite of forbidden usury (Riba). Riba operates on the rule of "give me more time and I will increase your debt" (exploiting the debtor's inability to pay). Conversely, Da' wa Ta'ajjal operates on "pay me early and I will reduce your debt," which relieves the debtor's burden, clears their conscience, and brings liquidity back to the creditor. Since it harms no one and eases financial strain, it is entirely lawful.

Frequently Asked Questions | الأسئلة الشائعة

Is reducing a debt for early payment considered a type of Riba (interest)?

No, it is the exact opposite of Riba. Riba involves increasing the debt in exchange for giving the borrower more time. Reducing the debt for paying early (less time) benefits the borrower and relieves them of a financial burden.

Can a creditor force the borrower to pay early in exchange for a discount?

No. The agreement to expedite the payment in exchange for a discount must be entirely mutual. If the borrower prefers to wait until the original due date to pay the full amount, they have the right to do so.

What is the Fiqh term for this type of transaction?

In Islamic jurisprudence, this is known as "Da' wa Ta'ajjal", which translates to "reduce (the debt) and expedite (the payment)".

Chapter 4.2 - Financial Matters

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