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Fatwa CenterA remittance company taking additional charges for delayed payment
Question
If i send money remittance from a door to door remittance group through cash advance and will pay the money after i received the salary paying 50 SR as service charge is it riba? The charge if it is cash is 25 SR and if it cash advance (the money to be send will be paid later) is 50 SR. The 25 SR will be for the door to door remittance group and 25 SR will be for the one financing the cash advance for a total of 50 SR for the service charge. The additional charges is allowed by the door to door remittance group. The 50 SR service charge remain regardless of whatever amount of money has been remitted and no penalties imposed if the remitter did not pay on time. Please advice if this is riba or not?
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 
is His slave and Messenger.
The transaction which you mentioned in the question is forbidden because the finance company gives a loan to the person to transfer money so that he will repay the amount later more than its value, and this is Riba (interest and/or usury).
Even if we presume that the currencies are different, the mentioned transaction is still not permissible because it is considered Riba because it includes giving a loan with interest, and all this is forbidden.
Allaah Knows best.
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