It is permissible to lend animals and it is recommended to pay in full, giving something better than that which ts owed Sahih Muslim 1601 b
Arabic hadith text
حَدَّثَنَا أَبُو كُرَيْبٍ، حَدَّثَنَا وَكِيعٌ، عَنْ عَلِيِّ بْنِ صَالِحٍ، عَنْ سَلَمَةَ بْنِ كُهَيْلٍ، عَنْ أَبِي، سَلَمَةَ عَنْ أَبِي هُرَيْرَةَ، قَالَ اسْتَقْرَضَ رَسُولُ اللَّهِ صلى الله عليه وسلم سِنًّا فَأَعْطَى سِنًّا فَوْقَهُ وَقَالَ "خِيَارُكُمْ مَحَاسِنُكُمْ قَضَاءً "
Translation
Abu Huraira (Allah be pleased with him) reported
Allah's Messenger (ﷺ) took a camel on loan, and then returned him (the lender) the camel of a more mature age and said: Good among you are those who are good in clearing off the debt.