What is the ruling on exchanging the Sudanese pound for the Saudi riyal on a deferred basis?
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The questioner : May Allah reward you with good. This questioner says: We want a definitive answer regarding the issue of currency exchange. We are in Sudan, and we sell Saudi riyals for Sudanese pounds, where the delivery of the riyals takes place in this country and the pounds after a while in Sudan. Is this permissible?
The Shaykh : The definitive answer, in our view, regarding this issue is that usury of deferment applies to paper currency, but usury of excess does not, because usury is of two types:
Usury of deferment, which is when the taking of possession is delayed between the two types of usurious items.
And usury of excess, which is when one side exceeds the other.
I will give you an example. If you sell one dirham for two dirhams in cash, hand to hand, this is usury of excess. Why? Because excess is an increase. Okay, if you sell one gold dinar for two dinars in cash, hand to hand, this is usury of excess. Okay, if you sell one dinar for one dinar and do not take possession, this is usury of deferment. If you sell one dinar for two dinars and do not take possession, no, that is wrong. If you sell one dinar for two dinars and do not take possession.
The student: ... .
The Shaykh : You have done well. In this case, there are two elements: excess and deferment. The excess is the increase, and the deferment is the delay. Regarding these paper currencies, we see that what is practiced in them is riba al-nasi'ah (usury of deferment). Therefore, if we assume that the Sudanese pound is equal to three riyals, for example—and I do not know the price—the Sudanese person does not say, "You have devalued our currency," meaning which one is more expensive, the riyal? Fine, ten Saudi riyals for fifty pounds, that is the price in the market. Then a person who needs Sudanese pounds comes and says, "Give me forty for ten, not fifty." Is this permissible or not permissible?
The Shaykh : The definitive answer, in our view, regarding this issue is that usury of deferment applies to paper currency, but usury of excess does not, because usury is of two types:
Usury of deferment, which is when the taking of possession is delayed between the two types of usurious items.
And usury of excess, which is when one side exceeds the other.
I will give you an example. If you sell one dirham for two dirhams in cash, hand to hand, this is usury of excess. Why? Because excess is an increase. Okay, if you sell one gold dinar for two dinars in cash, hand to hand, this is usury of excess. Okay, if you sell one dinar for one dinar and do not take possession, this is usury of deferment. If you sell one dinar for two dinars and do not take possession, no, that is wrong. If you sell one dinar for two dinars and do not take possession.
The student: ... .
The Shaykh : You have done well. In this case, there are two elements: excess and deferment. The excess is the increase, and the deferment is the delay. Regarding these paper currencies, we see that what is practiced in them is riba al-nasi'ah (usury of deferment). Therefore, if we assume that the Sudanese pound is equal to three riyals, for example—and I do not know the price—the Sudanese person does not say, "You have devalued our currency," meaning which one is more expensive, the riyal? Fine, ten Saudi riyals for fifty pounds, that is the price in the market. Then a person who needs Sudanese pounds comes and says, "Give me forty for ten, not fifty." Is this permissible or not permissible?