Is the shrouding (kafan) of the deceased obligatory?

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The shrouding of the deceased is obligatory. This obligation is established because the Prophet, peace and blessings be upon him, commanded it. Furthermore, the deceased's body requires covering after death just as it was required during life. The cost of shrouding is to be paid from the deceased's estate, taking precedence over debts, bequests, and inheritance. This precedence is demonstrated by the case of Hamza and Mus'ab ibn Umair, may Allah be pleased with them, who were shrouded in the only cloth available to each of them. This is analogous to the clothing of an insolvent person taking precedence over the repayment of his debt.