Answered by Shaykh Abdul-Rahim Reasat
Question
I would be grateful if you could let me know how the shari’a construes a loan from a partnership to one of its members. As the member receiving the loan would appear to be both debtor and joint creditor, it is perhaps not really a loan because there is no complete exchange of cash for debt? If that is the case, could it be said that any increase when repaying such a loan isn’t riba?
Answer
The best approach would be to take a loan from the personal wealth of the partners. You can repay it from your share of the profits if you like. This keeps the matter less complicated.
Borrowing from the partnership, however, would not be an issue. Your own share would not be considered a loan, because you own it. Any increase in repayment, in any loan, would be interest. [Maydani, al-Lubab]
I pray that helps. May Allah Most High grant you the best of both worlds.
[Shaykh] Abdul-Rahim Reasat
Checked and Approved by Shaykh Faraz Rabbani