What is the ruling on repaying a loan in a different currency?
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Question:
A questioner says: Two people in Saudi Arabia, one lent to the other. When the lender demanded his money from the borrower, the borrower converted the lender’s money into the currency of the lender’s local country using part of his own funds. What is the ruling on this? May Allah reward you.
Answer:
Currency exchange. What is considered currency exchange. That is, exchanging one currency for another. He was supposed to buy the currency he intended to send to the other person’s country, buying it from here and converting it. As for delaying the possession, this is feared to be riba (usury or interest), because the Prophet (peace and blessings be upon him) said: “They should not separate from each other until the exchange has taken place.” Yes.
A questioner says: Two people in Saudi Arabia, one lent to the other. When the lender demanded his money from the borrower, the borrower converted the lender’s money into the currency of the lender’s local country using part of his own funds. What is the ruling on this? May Allah reward you.
Answer:
Currency exchange. What is considered currency exchange. That is, exchanging one currency for another. He was supposed to buy the currency he intended to send to the other person’s country, buying it from here and converting it. As for delaying the possession, this is feared to be riba (usury or interest), because the Prophet (peace and blessings be upon him) said: “They should not separate from each other until the exchange has taken place.” Yes.
Source
قناة «العلامة الدكتور صالح الفوزان»، ما حكم ردّ المال المُقترَض بعملة أخرى؟ لمعالي الشيخ صالح الفوزان — youtube.com
The Arabic text is a machine transcription of the audio recording.