Not Paying Debt Due to Financial Hardship

Authored by: Fatwas of the Saudi Fatwa Committee
Topic: Debt and Accountability in Case of Financial Hardship

Is a Person Sinful for Not Repaying a Debt Due to Poverty?​

This depends on the borrower’s intention at the time of borrowing:

1. Intention to Repay:
   
   • If the individual borrowed money with a sincere intention to repay but later became unable to do so due to financial hardship, they are not sinful.
   • Allah will assist in settling their debts on their behalf, as indicated in the saying of the Prophet Muhammad ﷺ:
     “Whoever takes people’s wealth with the intention of repaying it, Allah will facilitate its repayment for them. And whoever takes it intending to squander it, Allah will bring about their ruin.”
     [Sahih al-Bukhari, Hadith No. 2387]
2. Intention to Waste:
   
   • If the individual borrowed with the intention of squandering or not repaying, they will be held accountable and sinful for their actions.

Guidance for Borrowers​

• A person must always have the intention to repay any borrowed amount.
• When financial ease comes, they should immediately settle their debts.
• Even in cases of borrowing items or goods, having the intention to return or repay is critical.

Divine Facilitation for the Sincere​

Allah promises to make a way for those who sincerely intend to fulfill their obligations. Trusting in Allah’s assistance while striving for repayment is essential.

Reference: Ibn Uthaymeen: Noor Ala Al-Darb, 16/244