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Why Should I Give Fidya?
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Qur'an Ayat Talking about Fidya:
"[Observing Saum (fasts)] for a fixed number of days, but if any of you is ill or on a journey, the same number (should be made up) from other days. And as for those who can fast with difficulty, (e.g. an old man, etc.), they have (a choice either to fast or) to feed a Miskin (poor person) (for every day). But whoever does good of his own accord, it is better for him. And that you fast, it is better for you if only you know.

The month of Ramadan in which was revealed the Qur'an, a guidance for mankind and clear proofs for the guidance and the criterion (between right and wrong). So whoever of you sights (the crescent on the first night of) the month (of Ramadan i.e. is present at his home), he must observe Saum (fasts) that month, and whoever is ill or on a journey, the same number [of days which one did not observe Saum (fasts) must be made up] from other days. Allah intends for you ease, and He does not want to make things difficult for you. (He wants that you) must complete the same number (of days), and that you must magnify Allah [i.e. to say Takbir (Allahu-Akbar; Allah is the Most Great) on seeing the crescent of the months of Ramadan and Shawwal] for having guided you so that you may be grateful to Him."

[Al-Quran 2:184-185]

 

Regarding the amount to be paid for Fidya:
Narrated 'Abdullah bin Ma'qal
I sat with Ka'b bin 'Ujra and asked him about the Fidya. He replied, "This revelation was revealed concerning my case especially, but it is also for you in general. I was carried to Allah's Apostle and the lice were falling in great number on my face. The Prophet said, "I have never thought that your ailment (or struggle) has reached to such an extent as I see. Can you afford a sheep?" I replied in the negative. He then said, "Fast for three days, or feed six poor persons each with half a Sa of food." (1 Sa = 3 Kilograms approx.)
(Sahih Bukhari, Vol. 3, Book 28, No. 43)

 

Regarding the choice to fast or pay Fidya for Elderly and Terminally-Ill People:
Narrated 'Ata:
That he heard Ibn `Abbas reciting the Divine Verse: "And for those who can fast they had a choice either fast, or feed a poor for every day.." (2.184) Ibn `Abbas said, "This Verse is not abrogated, but it is meant for old men and old women who have no strength to fast, so they should feed one poor person for each day of fasting (instead of fasting).
(Sahih al-Bukhari, Tafseer of the Prophet (pbuh), Vol. 6, Book 60, Hadith 32)

 

Regarding why the young and healthy should fast:
It was narrated that Salamah bin Al-Akwa said:
"When this verse was revealed 'And as for those who can fast with difficulty, (e.g. an old man), they have (a choice either to fast or) to feed a miskin (poor person) (for every day). Those among us who did not want to fast would pay the fidyah, until the verse after it was revealed and abrogated this."
(Sunan an-Nasa'i, The Book of Fasting, Vol. 3, Book 22, Hadith 2318)

 

Regarding Pregnant or Breastfeeding Women who Can't Fast:
Narrated Abdullah ibn Abbas:
Explaining the verse; "For those who can do it (with hard-ship) is a ransom, the feeding of one, that is indigent," he said: This was a concession granted to the aged man and woman who were able to keep fast; they were allowed to leave the fast and instead feed an indigent person for each fast; (and a concession) to pregnant and suckling woman when they apprehended harm (to themselves). 
(Sunan Abi Dawud, Book of Fasting, Book 13, Hadith 2311)

 

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