Fixing a cash price and a credit price
Question
Whilst dealing with customers, we come across customers that request a quote of a cash price. Generally, if our normal price is R220 for a wheel barrow and the customer generally has the option to pay 30 days from statement.
Where a cash price is requested, we would quote a lesser price of R210 although our services, delivery etc, will still remain.Does this reduction of the price for the purpose of receiving the cash imply that our normal selling includes a finance cost .i.e. Is the R220-R210=R10 a finance cost?
Answer
The concept of fixing a cash price and a credit price is permissible in Shariah. This is permissible on condition that the price and time is fixed. The R10 will be considered to be a discount in favour of the customer paying in cash. (al-Hidayah, Ahsanul Fatawa, Vol: 7, Pg: 30)
And Allah Knows Best
- Answered by
- Mufti Suhail Tarmahomed
- Checked & approved by
- Mufti Ebrahim Desai
Fatawa SA is an independent, read-only index of fatawa already published by Jamiatul Ulama KZN. It is not a fatwa service. For your own situation, ask the issuing Darul Ifta directly.