Selling an item for higher than the market price

22-4-2003 | IslamWeb

Question:

My question is regarding mobile telephone pre-paid cards. Such a card is marked SR100 and being sold in the market with different cash price from SR96 to SR100. I would like to know if it is permissible in Islam to sell this card at a cash price of SR100 and credit or installment price of SR102 or more. If anyone sells on credit at higher price that its marked price of SR100, then will the excess amount said as interest or profit? Is this not similar to get interest on money?

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Answer:

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad is His slave and Messenger.

 

A company or a person may sell the prepaid telephone cards or anything else at hundred in cash and hundred and ten; for example, on credit provided the contract should be completed at the same time including the kind of purchase, i.e. cash or credit. Making an open contract to allow the purchaser both options, to pay in cash or on credit, is forbidden. If, for example, the seller says the cost is hundred in cash and one hundred and ten on credit and the buyer takes it without making any final agreement on the kind of deal, then such transaction is not permitted.

Know that selling goods at a higher price when sold on credit is permissible according to the majority of the Muslim scholars. If the two parties agreed firsthand on the price then it is not considered Riba (interest and/or usury).

Allaah Knows best.