Zakāt may only be given to the categories mentioned by Allah in the Qur’an. Allah says: “Zakat expenditures are only for the poor, the needy, those employed to collect it, those whose hearts are to be reconciled, for freeing captives, for those in debt, for the cause of Allah, and for the traveler — an obligation from Allah.” (9:60). One of the recognized recipients is the person who is burdened by debt (al-ghārim).

Scholars explain that a debtor may receive zakāt if they are unable to repay their debt without falling into hardship and if they do not possess sufficient wealth beyond their basic needs. This ruling applies regardless of whether the debt arose from a permissible transaction or from a mistake, as long as the person is genuinely unable to repay it.

With regard to a sibling, zakāt may be given to brothers or sisters provided they qualify as legitimate recipients (for example, they are poor or heavily indebted). The only close relatives who cannot receive one’s zakāt are parents, grandparents, children, and grandchildren, because one is already financially responsible for them. Siblings are not included in that restriction.

The issue of the home loan involving ribā requires distinction. Ribā itself is prohibited in Islam, and a Muslim should avoid entering such transactions whenever possible. However, if a person has already entered into such a loan and is now burdened by debt, many scholars allow zakāt to be given to them if they qualify as a debtor in financial difficulty. The purpose of the zakāt in this case is to relieve their hardship, not to endorse the ribā transaction.

If you give zakāt to your sibling, it is permissible to advise them to apply it toward the principal of the loan rather than the interest. While you cannot absolutely control how they allocate their payments once the funds become their property, giving them this guidance is commendable and reflects your intention to avoid directly supporting the interest portion. What matters for the validity of zakāt is that the recipient qualifies and that the funds are transferred to them in ownership.

Therefore, if your sibling is genuinely struggling with the debt and does not have sufficient means to repay it, it is permissible to give them zakāt. Advising them to use the funds toward reducing the principal is a good and responsible approach, but the permissibility of giving the zakāt itself does not depend on being able to separate principal from interest.