Is delay in repayment of the debt regarded as charity on the part of the creditor?

Allah, may He be exalted, has instructed us to give more time to the
debtor who is in difficulty, if he cannot afford to pay off the debt, as
He says (interpretation of the meaning): “And
if the debtor is in a hard time (has no money), then grant him time till
it is easy for him to repay”
[al-Baqarah 2:280]. 

Moreover, it is recommended to waive the debt or part of it, as an act of
charity, as Allah says (interpretation of the meaning):
“but
if you remit it by way of charity, that is better for you if you did but
know” [al-Baqarah 2:280].

 Muslim (3014) narrated from Abu’l-Yasar (may Allah be pleased with him)
that the Messenger of Allah (blessings and peace of Allah be upon him) said:
“Whoever allows more time for a debtor who is in difficulty or waives the
debt, Allah will shade him with His shade.” 

The Prophet (blessings and peace of Allah be upon him) told us that the one
who gives more time to a debtor who is in difficulty will have for each day
(a reward) equivalent to giving that loan in charity, before the time for
payment of the debt comes, and after the time for payment of the debt comes,
he will have (a reward) equivalent to giving double that loan in charity for
each day he delays it and gives the debtor more time. That is to encourage
us to help fellow Muslims and give more time to one who is in difficulty, so
that he will not be compelled to resort to dealing in riba which is haraam,
acquisition of which may lead to doom, and for which there is a declaration
of war from Allah and His Messenger, and so that he will not find himself in
difficulty and feel distressed. Imam Ahmad (22537) narrated that Buraydah
(may Allah be pleased with him) said: I heard the Messenger of Allah
(blessings and peace of Allah be upon him) say: “Whoever gives more time to
a debtor who is in difficulty will have (a reward) equivalent to giving that
amount in charity for each day.” Then I heard him say: “Whoever gives more
time to a debtor who is in difficulty will have (a reward) equivalent to
giving double that amount in charity for each day.” I said: I heard you, O
Messenger of Allah, saying that whoever gives more time to a debtor who is
in difficulty will have (a reward) equivalent to giving that amount in
charity for each day, then I heard you say whoever gives more time to a
debtor who is in difficulty will have (a reward) equivalent to giving double
that amount in charity for each day. He said: “For each day he will have (a
reward) equal to giving that amount in charity before the time for repayment
of the debt comes, then if the time for repayment of the debt comes and he
gives him more time, for each day he will have (a reward) equivalent to
giving double that amount in charity. 

The hadith was classed as saheeh by al-Albaani in as-Saheehah (86)
and by the commentators on al-Musnad (ar-Risaalah edn). 

What you heard about it being as if the debtor was giving the value of the
loan that he loaned to his Muslim brother in charity every day is applicable
to the period before the time for repayment comes. If the time for repayment
comes and the debtor is still in difficulty and is not able to pay back the
loan, so the creditor lets him off and gives him more time to repay, then
for each day that he defers it, he will have (a reward) equal to that of
giving double the amount of money that he loaned to his brother, until the
latter is able to pay back the debt he owes. 

In
these teachings there is great wisdom and mercy from Allah towards His
slaves, as is apparent to anyone who gives the matter the slightest
thought. 

And Allah knows best.