It is narrated from Abdullah bin Ka'b that his father, Sayyiduna Ka'b bin Malik (may Allah be pleased with him), demanded repayment of a debt from Sayyiduna Ibn Abi Hadrad (may Allah be pleased with him). This incident took place during the Prophetic era. In this matter, their voices became so loud, while they were in the mosque, that the Messenger of Allah (peace and blessings be upon him) heard them while he was in his house. So the Messenger of Allah (peace and blessings be upon him) came to them, lifted the curtain of his chamber, and called out: "O Ka'b bin Malik!" He replied: "Yes, O Messenger of Allah! I am present." The Prophet (peace and blessings be upon him) gestured to him to forgive half of the debt. He said: "Yes, I have done so, O Messenger of Allah!" The Prophet (peace and blessings be upon him) then said to Ibn Abi Hadrad (may Allah be pleased with him): "Get up and pay the remaining debt."
Hadith Referenceالفتح الربانی / كتاب السلم كتاب القرض والدين / 6039
Hadith Gradingمحدثین:صحیح
Hadith Takhrij«أخرجه مسلم: 1558، (انظر مسند أحمد ترقيم الرسالة: 27177 ترقیم بيت الأفكار الدولية: 27719»
Brief Explanation
Benefits: … The Prophet (sallallahu alayhi wa sallam) instructed the creditor to forgive half of the debt; this is evidence of his mercy.
It is understood from this that a leader or responsible authority can tell the creditor to forgive a portion of the debt. The creditor, too, should consider the words of the leader and, demonstrating open-heartedness, comply with the instruction. (Abdullah Rafiq)