Exchanging currency and sending it abroad?

The questioner : In the name of Allah, the Most Gracious, the Most Merciful. Honorable Shaykh, what is the ruling on exchanging one currency for another? For example, a person residing in Saudi Arabia sends Saudi riyals to Yemen through someone traveling to his family, giving him the Saudi riyals here so that he can give Yemeni riyals in Yemen. Is this a sale that requires immediate exchange in the presence of the parties, or not? And is it riba (usury or interest)? Please inform us, may Allah reward you.

The Shaykh : Yes, this issue occurs frequently with people who come to Saudi Arabia, whether they are there for work, or as pilgrims performing Hajj or 'Umrah. They have money in the currency of their home countries, or they obtain Saudi currency. So how is it exchanged?
There are two ways to exchange it. Either you exchange it in the same place, where you give them, for example, Saudi riyals and take other riyals, and then you say, "Take these other riyals and exchange them for me." Is this clear, or not?
Let us suppose, as the questioner said, that it is Yemeni riyals for Saudi riyals. This man is from Yemen and works in the Kingdom. He has obtained Saudi riyals and wants to convert them to Yemeni riyals. We tell you there are two ways. The first way is that you buy Yemeni riyals here in Saudi Arabia, then give them to the bank to transfer them to Yemen. This is an easy process, but it may not be possible because there may not be enough Yemeni riyals to meet this man's need. The second way is that he says to the bank, "These are Saudi riyals; convert them for me to Yemen."
When it reaches Yemen, he agrees with the bank on the price there, meaning the sale and purchase take place there in Yemen at the price in Yemen. This is based on the hadith of 'Abdullah ibn 'Umar ibn al-Khattab (may Allah be pleased with them both) that they used to sell camels for dirhams and dinars and take dirhams for them. The Prophet (peace and blessings be upon him) was asked about that and said, "There is no harm in taking them at the price of the day, as long as you do not separate from each other with anything [in between]."

The questioner : What are the two ways?

The Shaykh : Yes.

The questioner : Actually, the first way is that the person himself takes the money, exchanges it, and then sends it.

The Shaykh : He takes the money from his own funds, buying it here.

The questioner : He converts it to Yemeni currency.

The Shaykh : And he transfers it, yes.

The questioner : Here, and then he sends it. That is all. He sends it from Saudi Arabia, and it is converted in Yemen through the bank.

The Shaykh : Yes, at the price there.

The questioner : Yes, but the current practice, Shaykh, is that, for example, they give me the same currency with a specific value inherent in it in all countries. So this person says to the bank, "Take this from me," and they agree on this, for example, on this price.

The Shaykh : This is not permissible. That is to say, if he agrees on the sale here, for example, and the possession takes place in Yemen, this is forbidden and not permissible. Because the sale of currencies for one another requires immediate exchange in the presence of the parties, hand to hand. And if I sell him the Saudi riyals here in Saudi Arabia and do not take their equivalent until in Yemen, the immediate exchange in the contract has not taken place.

The questioner : I sent it to someone else, Shaykh. I sent it in his name and gave it to him.

The Shaykh : Yes.