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View Full Version : Is It Haram to Own and Operate a Car Dealership In Western Countries?

12-24-2020, 07:05 PM
Assalamualaikum all,

I live in Canada and have been living here most of my life. I have a great passion for cars and my dream is to one day own my dealership ins 'Allah. In Canada, in order to be competitive in the market, a dealer must offer financing options along with the option of buying the car cash outright.

For those of you who are unfamiliar with the automotive industry, the way dealerships operate financing are as follows: Ahmed walks into a dealer and chooses a car he likes. The cost of the car is $20,000. Ahmed cannot afford the entire price so he decides to finance it and pay in installments. So the bank pays the dealer $20,000 and becomes the "lienholder" of the car. The bank then allows Ahmed to pay the $20,000 back to them with interest (riba). Ahmed then becomes involved with interest as he is now paying interest to the bank and the bank becomes involved because they are consuming interest. However, the dealer only made the $20,000 they were seeking for the car. They are not taking interest from Ahmed nor the bank. Is this permissible? Is the dealer also involved because they are helping Ahmed finance?

My question is this: do you think it is permissible to own and operate a dealership in the Western world such as Canada that has financing an option for customers? Also, what if the dealership sold MOST of their inventory cash and only financed 1/3 of the cars they sold?

I would love any input on this issue. Like I stated my dream is to own my own dealership one day and if its not permissible in the eyes of Allah I must change my plans.

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