The Statements of the Scholars on the Substitution of Paper Currency for the Two Metals
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The Statements of the Scholars on the Substitution of Paper Currency for the Two Metals
Shaykh Abd al-Rahman ibn Sa’di mentioned in his book of fatwas that the dirhams existing now do not follow or stand in place of the two metals. What is the basis of his statement? Is this correct? And what is built upon this?
You know that this paper currency is a recent occurrence and that it was not known previously.So the scholars differed regarding it into six statements: Some say: It is like clothing; riba does not apply to it, and zakah is not obligatory on it. It is considered merchandise for trade. If a person intends to trade with it, it is trade; if he intends to spend it, there is nothing in it, even if millions of millions gather in a person’s possession. Undoubtedly, this statement is invalid and has no standing.
And some of them said: That riba applies to it; riba al-fadl and riba al-nasi'ah. And that it is not permissible to take one dollar for two dollars, whether in cash or on credit. This is also an extreme statement.
And among them are those who say: If the type differs, difference in amount is permissible without delay. For example, it is permissible for me to buy a dollar worth four riyals for five riyals, or to sell it for three riyals when it is worth four in the market.But I need it, so I said to the one who has it: Give me a dollar for four riyals, or it is worth four and I need money and I found no one to buy it except for three; I sell it. Or it is a paper note and a person needs copper or iron money, so I give him a ten-unit note and take nine from him, and there is no harm. However, the condition in all of this is taking possession in the meeting of the contract.
This statement is a middle position between absolute prohibition and absolute permissibility. It is the choice of Shaykh Abd al-Rahman ibn Sa’di (may Allah have mercy on him); he sees that selling these currencies to one another is permissible, whether equal or differing in amount, on the condition that it is not on credit. The Shaykh (may Allah have mercy on him) is more lenient than what I said.Meaning: It is also permissible with him for the taking of possession to be delayed if it is not specified by a term. But what I mentioned is what I choose: if you sell a ten-unit note for nine and do not take possession, it is forbidden and the sale is invalid. If you take possession, there is no harm.
Shaykh Abd al-Rahman ibn Sa’di mentioned in his book of fatwas that the dirhams existing now do not follow or stand in place of the two metals. What is the basis of his statement? Is this correct? And what is built upon this?
You know that this paper currency is a recent occurrence and that it was not known previously.So the scholars differed regarding it into six statements: Some say: It is like clothing; riba does not apply to it, and zakah is not obligatory on it. It is considered merchandise for trade. If a person intends to trade with it, it is trade; if he intends to spend it, there is nothing in it, even if millions of millions gather in a person’s possession. Undoubtedly, this statement is invalid and has no standing.
And some of them said: That riba applies to it; riba al-fadl and riba al-nasi'ah. And that it is not permissible to take one dollar for two dollars, whether in cash or on credit. This is also an extreme statement.
And among them are those who say: If the type differs, difference in amount is permissible without delay. For example, it is permissible for me to buy a dollar worth four riyals for five riyals, or to sell it for three riyals when it is worth four in the market.But I need it, so I said to the one who has it: Give me a dollar for four riyals, or it is worth four and I need money and I found no one to buy it except for three; I sell it. Or it is a paper note and a person needs copper or iron money, so I give him a ten-unit note and take nine from him, and there is no harm. However, the condition in all of this is taking possession in the meeting of the contract.
This statement is a middle position between absolute prohibition and absolute permissibility. It is the choice of Shaykh Abd al-Rahman ibn Sa’di (may Allah have mercy on him); he sees that selling these currencies to one another is permissible, whether equal or differing in amount, on the condition that it is not on credit. The Shaykh (may Allah have mercy on him) is more lenient than what I said.Meaning: It is also permissible with him for the taking of possession to be delayed if it is not specified by a term. But what I mentioned is what I choose: if you sell a ten-unit note for nine and do not take possession, it is forbidden and the sale is invalid. If you take possession, there is no harm.