Not repaying debts is Khayanat to all

The above hadith makes it amply clear that not fulfilling someone's right or delaying the repayment of debt is equal to Khayanat. Consequently, all the traditions that are recorded in the chapter on Khayanat are equally applicable here and the Prophetic traditions have described Khayanat as a kind of oppression.

The Holy Prophet (s.a.w.s.) has announced:
"A Muslim who inspite of being capable delays the repayment of debt has committed oppression upon all the Muslims." 
(Wasaelush Shia Vol.13 page 97)

Not repaying a debt is a kind of oppression upon the creditor. In fact such an act is an oppression upon the Muslims in general. This is so because, upon seeing, that this person inspite of being capable is not repaying the debt, others who are capable of lending money will be disinclined to do so, for fear of meeting with a similar fate. Lending is a meritorious act and anyone who is responsible for discouraging it, has indeed oppressed all Muslims.

Hazrat Imam Ja'far as-Sadiq (a.s.) has said:
"May Allah curse the one who closed the door of good actions. And it is the one who is not thankful to the one who has done some good towards him. Consequently the doer of good refrains from doing the same favour towards someone else in the future." 
(Behaarul Anwaar, Wasaelush Shia)

Certainly, lending is an act of goodness. Not repaying or causing undue delay in the repayment is disregarding this favour. Also it can result in the creditor avoiding lending his money to anyone else in future.

Method of lending and borrowing

Authentic traditions have greatly emphasised the rewards that are promised for the one who lends. On the other hand, those who avoid this good deed have severe punishment in store. Sometimes it is obligatory to lend and not prohibited to lend. And sometimes it is Mustahab (recommended) to lend and Makrooh (detestable) not to lend.

Generally it is detestable to borrow but if the need to do so is genuine the detestibility is scaled down. The magnitude of detestibility is directly proportional to the actual gravity of the situation. In fact under some circumstances it is obligatory to borrow. For example it becomes obligatory to borrow to save one's life or honour. If a person knows that he will not be able to repay the loan, then precaution demands that he should refrain from borrowing unless he is in dire need.

Rewards for lending-punishment for not lending

The blessed Prophet of Allah (s.a.w.s.) said:
"One who lends to his believing brother and gives him respite till he is capable of repaying it, the amount that he has lent is considered as Zakat and the Angels pray for him and seek Divine mercy for him till this (amount) is returned."
(Wasaelush Shia Chap.6 Vol.13 page 86)

The Messenger of Allah (s.a.w.s.) has also remarked:
"If one lends to his Muslim brother, it is for his own (good). Every Dirham that he lends will qualify him for a reward equivalent to Mount Ohud (which is in Mecca) and Mount Sinai. And if he is lenient in collecting his debt he shall cross the bridge of Siratlike a stroke of lightning. And if a Muslim brother relates his woes before a person and this person does not lend him any money, the Heaven shall be denied to him on the Day of recompensing good doers." 
(Wasaelush Shia)

It is obligatory to have the intention of repaying ones debt

The person who is not in a position to repay his debt must necessarily have the intention to repay it as soon as he is capable of doing so. This intention should have the first priority with him. In fact the intention to repay should be there right at the outset. A person who takes a loan without having the intention to repay it is considered a thief. The following are the traditions of Imam Ja'far as-Sadiq (a.s.) regarding the intention of a person who takes a loan:
"One who takes a loan but does not care to repay it, is a thief."
(Wasaelush Shia chapter of Tejaarat)

He (a.s.) has also said:
"There are three kinds of thieves, one who does not pay Zakat, secondly one who does not consider the amount of Meher (dower) payable to the wife as an obligatory debt and one who takes a loan but does not intend to repay it."

The respected Imam (a.s.) further said,
"If the debtor intends to repay the loan, the Almighty Allah appoints two angels to help him till the loan is repaid. But if he becomes careless of this intention he becomes deprived of Allah's blessings."
(Wasaelush Shia)

The Incapable Debtor Must be given Respite

Although it is allowed for a debtor to sell off his unnecessary belongings to repay his debts, the creditor is under divine obligation not to cause undue trouble. The creditor should give respite so that the loanee can easily repay the dues. Under these conditions if he condones his loan altogether, it will be considered a Sadaqah which will remain with Allah as his trust and he will continue to benefit from it forever.

The Almighty says in the Holy Quran:
"And if (the debtor) is in straitness, then let there be postponement until (he is in) ease, and that you remit (it) as alms is better for you, if you knew." 
(Surah Baqarah 2:280)

Two important points can be derived from the Quranic verse quoted above. One, it is obligatory to give respite to a debtor who is incapable of repaying the loan. Secondly, it is more meritorious for the creditor to condone the loan completely.

Numerous traditions have mentioned these two points.

The Holy Prophet (s.a.w.s.) has said:
"Your debtor is not permitted to delay in repaying the loan if he is capable to pay it. In the same way you are not permitted to pressurise him unduly when you know that he is not in a position to repay you immediately."
(Wasaelush Shia)

The honourable Imam Ja'far as-Sadiq (a.s.) has been recorded to have said:
"Do not harass your Muslim brother with a demand to the repayment of debt when you know that he is not able to repay it. Because our exalted grandfather the Messenger of Allah (s.a.w.s.) has said that it is not permitted for a Muslim to harass his Muslim brother. And if a creditor gives respite to a loanee he shall become qualified to receive the shade (and protection) of the Almighty on the day when there will be no other shade."
(Wasaelush Shia)

It means that on the Day of Judgement such a person will receive special favours from the Almighty. The Masoom (a.s.) has also remarked:
"If one wishes that he be given refuge under Divine shade on the day when there will be no other shade, he should grant respite to his debtor and must not demand it (immediately), or should condone his loan completely."
(Wasaelush Shia)

Hazrat Imam Muhammad al-Baqir (a.s.) has said:
"There would be some people under the shade of the Arsh on the Day of Qiyamat such that their faces will be bright, their dresses and their chairs shall be glittering. Then an announcer will call: These are the people who did good towards the believers and gave respite to the incapable debtor till the time he could repay the debt."
(Wasaelush Shia)

Each Day of Respite Brings Rewards of Sadaqah

The trustworthy scholar of the Shias, Shaykh Kulayni (r.a.) has recorded that Imam Ja'far as-Sadiq (a.s.) is reported to have said:
"One day the Holy Prophet (s.a.w.s.) mounted the pulpit and after glorifying Allah and praising the prophets (a.s.) said: 'Those who are present are under the obligation to convey (what I say now) to those who are not present (in the assembly).'

Then He (s.a.w.s.) said:
'If one gives respite to his helpless debtor then till the time he receives his loan it is upon Allah to record the reward of Sadaqah in his scroll of deeds.'"
(Wasaelush Shia)

For each day of respite that a person gives his debtor he receives divine reward equivalent to the spending of the loan amount as Sadaqah. Several traditions on this subject could be quoted but the ones mentioned should suffice. It must be remembered that avoiding or delaying the payment of Khums and Zakat is also considered a failure to restore rights. Not paying Zakat is also a Greater sin according to the rulings of the Quran and hadith. We shall deal with it in a separate chapter.

Allah will Forgive

If a person dies before he has repaid his debt and the creditor has not been compensated for it from the belongings left by him; the creditor has not forgiven him his debt and provided the debtor has not been negligient about repaying, nor was the loan taken for an illegal purpose and also the person had every intention of repaying but was unable to do so. Under these circumstances according to traditions Allah (a.j.) by His Grace will compensate the creditor on the Day of Judgement.

Muhammad Bin Bashir came to Imam Ja'far as-Sadiq (a.s.) and told him that he owed a thousand Dinars to Shahab. He requested the Imam to persuade Shahab to respite him till the days of Hajj. So Imam (a.s.) summoned Shahab and said:
"You know that Muhammad Bin Bashir is among our followers. He owes you a thousand Dinars. This amount was not spent by him on himself. Rather it remained as a debt upon some people and he had to bear the loss. I wish that you will forgo your thousand Dinars."

Then he (a.s.) said,
"Maybe you are under the impression that his good deeds will be given to you in return of your loan?"

Shahab said, "Yes, I am under this impression." Imam (a.s.) told him,
"The Almighty Allah is Merciful and Just. If someone, in order to achieve Allah's nearness, worships Him on frigid winter nights and fasts on hot summer days, circles the Holy Ka'ba. Then do you think after all this Allah will take away his good deeds and give them to you? It is not so, His mercy is much more. By His munificence He recompenses the good deeds of a believer."

After listening to these words Shahab said that he has condoned his loan forever.