Penalty for missed payments

Q: I’m renting a commercial shop and the contract has a clause regarding missed payments and interest etc… Can I say to ‘seller/landlord’ I will pay 10% on the rental amount if the rent is missed by 7 days and 20% if it’s missed by 14days? Please advise.


الجواب حامدا ومصليا ومسلما ومنه الصدق والصواب

A: The rental amount owed to the landlord is a debt. Any increase in debt due to delayed payment, irrespective of what name it is given, is riba. Ideally, there should be no punitive clause and you should pay the rent as agreed. But if the landlord requires assurance that you will pay on time through some form of incentive, then you may undertake a unilateral promise to donate to charity a given amount in the event of delayed payment. However, this unilateral promise should not be a condition of the lease contract and should be documented separately.


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