Cautions in selling gold for gold that must be avoided to prevent riba (usury or interest)

Question:
May Allah reward you with good and do you good. In the case of exchanging gold, the weight may be the same or it may differ, and if you sell to and buy from another person, the difference may be significant. They call the difference in price the manufacturing cost. What is the ruling on the difference in price and the interests of the people? May Allah reward you with good.

Answer:
If gold is sold for gold, two things are necessary. First, equality in weight, without regard to the quality of one or the lack of quality in the other, or that one is manufactured and the other is not. Equality in weight and measure is necessary. If there is a difference, then this is explicit riba (usury or interest), as the Messenger of Allah (peace and blessings be upon him) said: The second thing is the exchange of possession in the assembly. If they separate without the exchange of possession for the whole or for part, then this is riba al-nasi'ah (usury of deferment), based on the saying of the Messenger of Allah (peace and blessings be upon him): hand to hand, and the meaning of that is the exchange of possession in the assembly. If they separate and do not exchange possession, or if one of them does not receive his gold, then this is riba al-nasi'ah (usury of deferment). As for the issue of the manufacturing cost or the issue of quality, these matters have no bearing, and it is not permissible to make a difference because of them. So if you have gold that is not desirable, and you want gold that is better than it, then you sell the gold you have for currency or something else of a different type, and you buy with the value whatever you wish of the gold you desire, which is higher grade than the gold you have. The evidence for this is that when the good dates from Khaybar were brought to the Prophet (peace and blessings be upon him), he said: "Is all the date of Khaybar like this?" They said: "No, O Messenger of Allah, we buy one sa' (a dry measure of about 3 kg) of this, meaning the good ones, for two or three sa' (a dry measure of about 3 kg) of the bad ones." The Prophet (peace and blessings be upon him) said:
And the Messenger of Allah (peace and blessings be upon him) repeated that, disapproving of this action. Then he said: "Sell the inferior dates for dirhams, and then buy with the dirhams the superior dates." The superior dates are the good dates. This indicates that if a person has gold he wishes to get rid of because it is not of good grade, and he wants gold that is better than it, then he sells the gold for dirhams, and buys with the dirhams from the good gold. This is what the Messenger of Allah (peace and blessings be upon him) guided to. Yes.