This excerpt is taken from Dr. Yusuf al-Qaradawi's book Halal and Haram in Islam, translated into Urdu by Muhammad Tahir Naqqash.
Selling on Credit at a Higher Price
It seems very appropriate to state here that just as it is permissible to buy something with cash, similarly, buying on credit with mutual consent is also permissible. The Prophet ﷺ had pledged his armor with a Jew and bought grain on credit for his family.
Reference: Bukhari, Book of Pledge, Pledging Armor 2509, Muslim, Book of Sales, Chapter on Pledge, Hadith: 17
However, if the seller increases the price because of the credit, as many merchants do by raising the price on the condition of installment payments, then according to some jurists, this situation is forbidden because the extra amount charged due to delayed payment is a form of interest.
يهي بات دلائل كي رو سے قوي هے اس كي تفصيل كے ليے راقم كي كتاب احكام ومسائل ملاحظه هو اور حافظ عبد المنان نور پوري رحمه الله كي كتاب احكام و مسائل بهي. (مبشر احمد رباني)
But the majority of scholars permit it, because it is originally permissible and no text has come forbidding it, nor is there complete equivalence with interest in it. Also, for various reasons, the seller may increase the price, provided that this price does not reach the level of blatant profiteering and explicit exploitation, otherwise it would be forbidden.
Imam Shawkani, may Allah have mercy on him, says:
According to the Shafi'is, Hanafis, Zaid bin Ali Muayyad billah, and the majority, this case is permissible based on the general evidences of permissibility. And apparently, this seems correct.
Reference: Nail al-Awtar, Vol: 5, p: 153
Sale Salam
On the contrary, the permissibility is in the form that the agreed amount is given in advance to the seller so that after the specified period, the goods can be obtained in exchange. In jurisprudential terminology, this is called Bay' Salam. It was a common practice in Medina, but the Prophet ﷺ reformed it and, considering the Shariah requirements, made it conditional with a few conditions. Thus, the Prophet ﷺ said:
من أسلف فليسلف فى كيل معلوم ووزن معلوم إلى أجل معلوم
"Whoever wants to conclude a transaction by paying in advance should specify the measure, weight, and the period."
Reference: Bukhari, Book of Salam, Chapter on Salam for a known measure: 2240, 2239; Muslim, Book of Sales, Chapter on Salam, Hadith: 1604
In such a case, no dispute can arise, and the possibility of deception will also not remain. The Prophet ﷺ also forbade the advance sale of fruits of specific trees.
Reference: Bukhari, Book of Salam, Chapter on Salam for one who does not have the principal, Hadith: 2247, 2246; Muslim, Book of Sales, Chapter on the prohibition of selling fruits before their ripening, Hadith: 1538, 1537
Because there is also a fear of deception in this; it is possible that due to some calamity, those trees may not bear fruit at all. The correct form of the transaction is that the production of a specific tree or specific land should not be stipulated, but only the measure and weight should be determined to conclude the transaction. However, if the owner of the tree or land is explicitly exploited unfairly, i.e., necessity forces him to accept the deal, then it is mostly considered forbidden (haram).
