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Selling what one purchased with deferred payment

Question

Assalaamu alaykum. A company buys a product from a supplier but does not pay that supplier for a month or so but still sells the stock to customers, is this ok given that they seem to be selling what they do not own? I think that this is how Amazon also does business, alongside maybe others.

Answer

All perfect praise be to Allaah, The Lord of the worlds. I testify that there is none worthy of worship except Allaah and that Muhammad  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) is His slave and Messenger.

Deferred payment of the price – in goods that do not require to be exchanged hand to hand – is Islamically permissible according to the agreement of the scholars, and this does not affect the validity of the sale transaction at all.

There is no relationship at all between an individual selling an item that he bought with a deferred payment and one selling that which he does not own. The difference is clear, and there is no problem with it.

Selling what a person does not own means that he sells a particular commodity that he did not purchase to start with and that did not enter into his possession; this is what is forbidden in Islam.

As for a person selling what he bought with a deferred payment, then this is Islamically permissible without any problem.

Allaah knows best.

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