Dayn

A debt or financial obligation owed by one person to another, whether from a loan, a deferred-price sale, or damages. Islamic law treats dayn seriously in both directions: the Qur'an requires debts to be written down and witnessed (2:282), the Prophet declined to pray over a man who died in unpaid debt, and creditors are commanded to grant time to debtors in hardship (2:280).

Because dayn is money owed, it cannot be sold at a discount or increased for delay (that would be riba), and zakat rules treat debts owed to you as assets and debts you owe as deductions.

The Islamic treatment of dayn cuts against both the casual borrowing and the casual lending of American consumer culture. On the debtor side, debt is a grave obligation: the Prophet asked whether a deceased person had debts before leading the funeral prayer, scholars hold that unpaid debt is not forgiven by martyrdom, and deliberate default by someone able to pay is described as injustice. That is why Islamic personal finance treats getting out of debt, including interest-bearing debt already incurred, as a priority ahead of investing.

On the creditor side, debt is to be documented (the longest verse in the Qur'an, 2:282, is about writing down loans), collected without increase, and forgiven or extended for a debtor in genuine difficulty. Three modern rules follow. Debts cannot be sold at a discount under the majority view (Bay' al-Dayn), which shapes factoring and fixed-income investing.

Debts cannot grow with delay, which rules out interest and compounding late fees and leaves only charity-directed penalties and actual-cost recovery. And debts count in zakat: money owed to you that you expect to collect is part of your zakatable base, while debts you owe that fall due within the year are deducted by most scholars. For a household this means a halal financing contract is still a dayn to be honored exactly, an interest-free loan from a relative should be written down with a schedule, and a credit card balance is a debt to be cleared before any discretionary saving.