“O you who believe, when you transact a loan for any period, you shall write it down. An impartial scribe shall do the writing. No scribe shall refuse to perform this service, according to God’s teachings. He shall write, while the debtor dictates the terms.” 2:282
In 2:282 we read about the rules of lending money. One of the rules state that if a loan is contracted between two individuals that the borrower is the one who dictates the terms of the loan. This may seem contrary to common practice; it is normal to see the lender as the one who dictates the terms and not the borrower, but God’ wisdom is unequalled.
God decrees that since the lender is the one who is always in a stronger position, then the borrower should be the one who dictates the terms for the following reasons:
1- On one hand, if the lender is left to dictate his terms he would impose unfair terms, and the borrower may have to accept due to his dire need for the money. This would result is a case of ‘Riba’ (usury).
2- However, if the borrower writes the terms, he will not write terms which are unfair to the lender because if he does, the lender (who is not in financial difficulty) will simply refuse the deal, then the borrower will get nothing. This rule will insure that fair terms will be written for both parties.
God is always the Most Wise.