Question
If I sell a product for R100 and some people want to buy the product but they are taking long to pay so can I sell it for R105 to them because of the long payment or will it be checked as interest?
Answer
If you have already sold the item to the client for R100 but want to increase the price to R105 due to delayed payment then it is impermissible to do so as the additional $5 will be considered to be interest.
However, if your question pertains to future transactions, then yes, it is permissible to offer the item at a cash price for R100 or a credit price for R105. However, the option of purchasing for a cash price of R100 or credit price of R105 should be determined and stipulated at the time of concluding the sale, and the payment time limit should also fixed when selling on credit, by stating that the purchaser is required to pay within 10 days / 20 days, etc. which the customer should accept. This method of concluding the sale is acceptable in terms of Shariah.
However, if after concluding the transaction, the client exceeds the stipulated payment time then he cannot be penalized in anyway whatsoever.
Checked and Approved By:
Mufti Muhammed Saeed Motara Saheb D.B.