he is in dire straits and truly in need; one must take his circumstances into consideration.
***
Lending Is One of the Righteous Deeds

Question: In our country there is a form of lending whose validity I doubt. When a person needs to borrow a sum of money, he goes to one of the merchants to obtain the loan. If that merchant also happens to be a farmer, he stipulates that the borrower must first purchase some of the merchant’s crop before it is harvested, so that he may sell it and make use of the proceeds. The borrower may then have to sell the crop at a low price, while he is required to repay its original owner at a higher price. Is such a loan permissible, or not? And does it fall under the category of a loan that brings about a benefit to the lender?

Answer: There is no doubt that a loan which relieves a Muslim’s need is one of the virtuous deeds for which a person is rewarded; it is an act of goodness. A Muslim is expected to lend to his brother purely for the sake of Allah, seeking no worldly gain or material benefit, but rather drawing closer to Allah by fulfilling his brother’s need and easing the hardship of the distressed. As for the borrower, he is obliged to return the loan to its owner without procrastination or delay once he is able, so that he may repay the kindness and so that this practice may become widespread among the Muslims. A loan is a contract of benevolence from which both parties benefit: the borrower benefits by having his need met, and the lender benefits by earning reward and performing a charitable act.

However, to exploit the loan for worldly profit or personal benefit is among the gravest