Is it permissible to lend a tenant money to purchase oxen for working his land or seeds for sowing, if this condition is stipulated in the loan contract?
Chapter on Loan (Qard)
Al-Mughni
Book of Sales
Primary text
If the condition requiring the use of the loan for purchasing oxen for working the land or buying seeds for sowing is stipulated within the loan agreement, the contract is invalid (not permissible). This is because stipulating a benefit for the lender in the loan contract is analogous to stipulating an increase (Riba) in the principal sum.
Supporting text
Ibn Abi Musa stated that even if the condition is not explicitly stipulated, the loan is not permissible because it draws an incidental benefit (Qard jarr manfa'ah). Furthermore, if a person requested a loan of a thousand with the condition that the lender be allowed to farm his land for a third share, this would be considered nefarious (khabith). However, the preferred view is that such an arrangement is permissible if it is not stipulated, as necessity dictates it, the borrower only intends self-benefit, and the lender's benefit accrues incidentally, resembling taking a safe deposit (sufthaj) and receiving repayment in another city, thus constituting a mutual benefit.