He asks about transferring via currency, saying: What is the ruling on transferring dirhams through the bank, meaning that I pay a Saudi riyal here in Saudi Arabia?
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The questioner : He asks about transferring via..., saying: What is the ruling on transferring dirhams through the bank, meaning that I pay a Saudi riyal here in Saudi Arabia, and I am given a Moroccan dirham there in Morocco, and the check, or he says by virtue of the check, is delivered to the person here, and I send it to Morocco via the post, and then the recipient there receives the amount sent and agreed upon?
The Shaykh : We understood from this question that he wants to exchange currency for currency without taking possession, meaning that he exchanges Saudi dirhams for Moroccan dirhams without the counterparty taking possession of the exchange.
The questioner : He took possession of the check, O Shaykh.
The Shaykh : Yes.
The questioner : Yes.
The Shaykh : Wait for me a moment.
The questioner : Yes, please go ahead.
The Shaykh : Without taking possession of the exchange, this is one aspect.
The questioner : Yes.
The Shaykh : Another aspect is that he takes possession of the check that was converted to Moroccan dirhams, and he has already delivered Saudi dirhams. As for the first case, it is riba (usury or interest), because we see that transactions in these paper currencies involve riba al-nasi'ah (usury of deferment), meaning that some of them cannot be exchanged for others except hand-to-hand, because they are currencies of different types, and thus they are in the position of gold and silver.
The questioner : Yes.
The Shaykh : And if gold and silver are sold for one another, it must be hand-to-hand. As for converting it to a check, it is also like the first case, because the check is considered a transfer slip and not taking possession of the exchange. Therefore, if it were assumed that there was no balance for the party to whom it was transferred by this check, he would return it to the first party.
The questioner : Yes.
The Shaykh : And he is not considered to have received what was transferred to him as long as the check is in his hand until he takes possession of his exchange. There is no difference between delivering a check with it or writing a letter with it to notify the other party. This is our opinion in this issue.
And regarding currencies, or more accurately, these paper currencies, people have differed greatly, to the extent of six opinions among the scholars. But what is stronger in my view is what I indicated, that riba al-nasi'ah (usury of deferment) applies to them, but not riba al-fadl (usury of excess). So we say the sound path to this is that you buy Moroccan dirhams here and give them to the bank to transfer them to you in Morocco, for example, or you buy American dollars here and give them to the bank to transfer them to you in America.
The questioner : Yes.
The Shaykh : And so on. As for giving them Saudi currency and then receiving its exchange in another currency in the country to which you transferred, this is not permissible.
The Shaykh : We understood from this question that he wants to exchange currency for currency without taking possession, meaning that he exchanges Saudi dirhams for Moroccan dirhams without the counterparty taking possession of the exchange.
The questioner : He took possession of the check, O Shaykh.
The Shaykh : Yes.
The questioner : Yes.
The Shaykh : Wait for me a moment.
The questioner : Yes, please go ahead.
The Shaykh : Without taking possession of the exchange, this is one aspect.
The questioner : Yes.
The Shaykh : Another aspect is that he takes possession of the check that was converted to Moroccan dirhams, and he has already delivered Saudi dirhams. As for the first case, it is riba (usury or interest), because we see that transactions in these paper currencies involve riba al-nasi'ah (usury of deferment), meaning that some of them cannot be exchanged for others except hand-to-hand, because they are currencies of different types, and thus they are in the position of gold and silver.
The questioner : Yes.
The Shaykh : And if gold and silver are sold for one another, it must be hand-to-hand. As for converting it to a check, it is also like the first case, because the check is considered a transfer slip and not taking possession of the exchange. Therefore, if it were assumed that there was no balance for the party to whom it was transferred by this check, he would return it to the first party.
The questioner : Yes.
The Shaykh : And he is not considered to have received what was transferred to him as long as the check is in his hand until he takes possession of his exchange. There is no difference between delivering a check with it or writing a letter with it to notify the other party. This is our opinion in this issue.
And regarding currencies, or more accurately, these paper currencies, people have differed greatly, to the extent of six opinions among the scholars. But what is stronger in my view is what I indicated, that riba al-nasi'ah (usury of deferment) applies to them, but not riba al-fadl (usury of excess). So we say the sound path to this is that you buy Moroccan dirhams here and give them to the bank to transfer them to you in Morocco, for example, or you buy American dollars here and give them to the bank to transfer them to you in America.
The questioner : Yes.
The Shaykh : And so on. As for giving them Saudi currency and then receiving its exchange in another currency in the country to which you transferred, this is not permissible.