Explanation of Article 385
The article clarifies the invalidity of any condition at the time of the loan contract or when deferring repayment that includes an increase in the repayment of the loan that the borrower pays to the lender; as scholars agree that any loan that brings benefit to the lender is considered usury. For example, lending a thousand with the condition to repay a thousand and one hundred, whether the increase is stipulated at the time of borrowing or during the loan period in exchange for deferring repayment. The prohibited increase does not include the borrower's bearing of loan expenses or repayment expenses as will be detailed in Article (390). The basis for prohibition according to the text of the article is that the increase must be conditional and must be for the lender over the borrower; based on that: 1- An increase in loan repayment is permissible if it is not conditional; rather, it is considered good repayment. 2- It is permissible to agree in the loan contract on mutual benefits between the contracting parties that do not result in an increase paid by the borrower to the lender; such as when two or more persons agree that each will lend the other the same borrowed amount without increase. 3- If the loan results in a benefit that the lender receives from someone other than the borrower; it is permissible if it is not a trick to take an increase from the borrower.
Related To
Article 385
Any condition requiring the payment of interest upon conclusion of a loan contract or the deferral of payment shall be deemed null and void.