Dr. Nazier Ayad, Egypt’s Grand Mufti, has ruled that selling a debt owed by a buyer to a third party for a deferred payment is prohibited in Islamic law, as it constitutes “Bay‘ al-Kali bil-Kali”—the sale of debt for debt—explicitly forbidden by the Prophet Muhammad ﷺ.
The Mufti explained that such a sale involves significant uncertainty (gharar) and lacks tangible assets, leading to instability in financial transactions. He emphasized that a debt is a personal obligation tied to the debtor’s liability and cannot be traded or sold like a commodity before being received.
Citing the hadith “The Prophet forbade the sale of debt for debt,” Dr. Ayad highlighted that this principle prevents both parties from entering deals based on unrealized and uncertain obligations. He added that all four major Islamic schools of jurisprudence—Hanafi, Maliki, Shafi‘i, and Hanbali—agree on the impermissibility of selling debts to anyone other than the debtor.
He further noted that Islam encourages justice, transparency, and financial fairness, and that the only permissible alternative to such transactions is “hawala” (debt transfer), which must be done with the full consent of all parties involved.
Dar al-Iftaa concluded that following Sharia-based financial ethics ensures economic stability and prevents exploitation, reminding merchants and investors that Islamic commerce is not only about profit but about integrity, accountability, and public trust.
