Muwatta Malik: Book 32, Hadith 3

Malik said, “The recognised and permitted form of qirad is that a man take capital from an associate to use. He does not guarantee it and in travelling pays out of the capital for food and clothes and what he makes good use of, according to the amount of capital. That is, when he travels to do the work and the capital can support it. If he remains with his people, he does not have expenses or clothing from the capital.”

Malik said, “There is no harm in the two parties in a qirad helping each other by way of a favour when it is acceptable to them both.”

Malik said, “There is no harm in the investor of the capital buying some of the goods from the agent in the qirad if that is acceptable and without conditions.”

Malik spoke about an investor making a qirad loan to a man and his slave, to be used by both. He said, “That is permitted, and there is no harm in it because the profit is property for his slave, and the profit is not for the master until he takes it from him. It is like the rest of his earnings.”

Muwatta Malik: Book 32, Hadith 3

 
The above hadith is from the Muwatta Malik collection of hadiths. Imam Malik ibn Anas spent 40 years composing the Muwatta Malik in the 8th century. This highly respected early work assembles fewer than 2,000 hadiths, which are thoughtfully divided into 61 books covering legal and ethical topics.

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For more Hadith in Book 32: Qirad
 

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