The ruling on one who borrows a sum in one currency and then its value changes
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The ruling on one who borrows a sum in one currency and then its value changes
May Allah reward you, O Shaykh! Regarding the increase in currency, the creditor borrows from the debtor, and then the currency rises. Is it obligatory for him to pay in the currency after the rise or before the rise? May Allah reward you.
Meaning: Did the currency change?The questioner: Yes.
The Shaykh: If the currency changes, one looks at the value of the original currency at the time of the change,For example: if we had agreed with him on two hundred riyals of a specific type,Then this type is cancelled, it is said: what is its value at the time of cancellation.
The questioner: That is essentially the debt.
The Shaykh: Describe to me the issue that is in your mind?The questioner: For example: So-and-so borrows from another so-and-so; Ahmad borrows from Muhammad a sum of one thousand dollars, and then, at the time of repaying the debt, the currency rose and became, for example, one thousand and two hundred.
The Shaykh: Meaning: the value of the dollar rose.
The questioner: Yes.
The Shaykh: Well, he must pay in dollars, whatever their value may be. Let us suppose that at the time of the contract the value of the dollar was ten, and then it rose to twenty; he must give it to him in dollars, even if it is twenty. Likewise, conversely, if the value of the dollar decreased, does the creditor demand the value of the dollar first? No.
He gives it to him in dollars, even if it is at half the value.
May Allah reward you, O Shaykh! Regarding the increase in currency, the creditor borrows from the debtor, and then the currency rises. Is it obligatory for him to pay in the currency after the rise or before the rise? May Allah reward you.
Meaning: Did the currency change?The questioner: Yes.
The Shaykh: If the currency changes, one looks at the value of the original currency at the time of the change,For example: if we had agreed with him on two hundred riyals of a specific type,Then this type is cancelled, it is said: what is its value at the time of cancellation.
The questioner: That is essentially the debt.
The Shaykh: Describe to me the issue that is in your mind?The questioner: For example: So-and-so borrows from another so-and-so; Ahmad borrows from Muhammad a sum of one thousand dollars, and then, at the time of repaying the debt, the currency rose and became, for example, one thousand and two hundred.
The Shaykh: Meaning: the value of the dollar rose.
The questioner: Yes.
The Shaykh: Well, he must pay in dollars, whatever their value may be. Let us suppose that at the time of the contract the value of the dollar was ten, and then it rose to twenty; he must give it to him in dollars, even if it is twenty. Likewise, conversely, if the value of the dollar decreased, does the creditor demand the value of the dollar first? No.
He gives it to him in dollars, even if it is at half the value.