In the name of Allah Almighty. Question: Transaction with a Non-Muslim who has no belief in Allah. A Muslim will purchase an item and the payment will be made by a non-muslim. The Muslim person knows that the other person is dealing with bank loans and interests. A fixed charge or commission will be paid for each purchase. The purchase will be done on credit, for one or more months, and in case of a delay in payment, the contract will be void and the charges or commission will be calculated anew. What difference does it make when we buy a car form Toyota for cash and we never think that Toyota itself is based on bank loans? Kindly let me know if the above case is lawful and 100% halal. I would like to further state from my own idea and knowledge that I am indirectly involved in bank loans. I am escaping from interest, but it may be a technique using a Non-muslim for my own benefits. The money I will earn will be generated through a haram route. To do transactions with someone, is it necessary to check his wealth and source of income? I will be very much grateful if you publish my question in detail and answer me with authentic records. Thank you.

All perfect praise be to Allah, the Lord of the worlds. I testify that there is none worthy of worship except Allah and that Muhammad, sallallahu ‘alayhi wa sallam, is His slave and Messenger.

Your question included many points, and the answer to them is as follows:

First, there is no harm in conducting a lawful transaction with a non-Muslim. The Islamic Shariah allowed the Muslims to engage with non-Muslims in selling and buying provided that the sale transaction does not involve something unlawful such as dealing in interest or buying and selling alcohol, dead animals, pork, and the like. The Prophet, sallallahu ‘alayhi wa sallam, engaged in transactions with non-Muslims. At the time of his death, his shield was pawned with a Jew for thirty measures of barley, as cited in Saheeh Al-Bukhaari and other books of Hadeeth. Moreover, the Companions used to engage in financial transactions with non-Muslims during the lifetime of the Prophet, sallallahu ‘alayhi wa sallam, and after his death.

Accordingly, there is no harm in having a non-Muslim broker or middleman in a lawful transaction. The fact that this non-Muslim engages in other transactions that are unlawful does not forbid the Muslim from dealing with him. The Jews used to deal in usury and acquire ill-gotten gains, yet the Prophet, sallallahu ‘alayhi wa sallam, engaged in transactions with them, as mentioned above.

Second, regarding the purchase on credit with a change in the value of the commission or fees in case of delayed payment; if you mean that the installments would be increased and interest would be added to the original sum, then this is prohibited interest. If this is the nature of the transaction in reference, then it is prohibited and it is impermissible to engage in such a transaction with a Muslim or a non-Muslim. However, if you mean something else, then please clarify it so that we can give you an accurate answer.

Third, the fact that the person (or company) has taken an interest-based loan or has engaged in prohibited transactions, whether this person is Muslim or non-Muslim, does not forbid dealing with him or it (company) in a lawful transaction. However, it is impermissible to engage in an unlawful transaction with him even if this person does not engage in other unlawful transactions. The determining factor in this regard is the very transaction in which you are engaged with this person or company. As long as this transaction is lawful, it is permissible to engage in it; otherwise, it is prohibited to engage in an unlawful transaction. It should be noted, though, that the Muslim should avoid dealing with those who do not keenly avoid unlawful gains.

Al-Buhooti wrote, “It is disliked to deal with a person whose wealth is mixed, part lawful and part unlawful, whose source is unknown ... The dislike increases or decreases in proportion to the amount of the unlawful part of his wealth. The Prophet, sallallahu ‘alayhi wa sallam, said, ‘...he who avoids doubtful matters clears himself in regard to his religion and his honor...’” [Kashshaaf Al-Qinaa’]

Fourth, it is impermissible for the Muslim to take an interest-based loan unless there is a valid necessity for it. Allah, the Exalted, says (what means): {...while He has explained in detail to you what He has forbidden you, excepting that to which you are compelled...} [Quran 6:119] The determining criterion of the valid necessity is that if he did not do the unlawful, he would lose his life or come close to losing it or face unbearable hardship. The necessity – if established – is measured in accordance with its extent and must only be answered proportionately. It is not an obligation to verify the source of the wealth and earnings of the person with whom the Muslim engages in financial transactions, whether he is Muslim or non-Muslim.

Fifth, there are some overlapping and unclear points in your question. Verily, judgment on any matter is based on conceptualizing it. Making mere assumptions that may not exist in real life is of no benefit, so it is better to avoid it. Our answer above is intended to be in the general sense; if you can verbally consult scholars regarding the matters that you find confusing, this would be better.

Allah knows best.