Ruling on the sale of currency for currency without immediate exchange
Machine translationRead the Arabic original
Question:
The listener Abdulrahman Ali Shalabi sent a question, saying: Some entities invest their funds in silver and dollars by buying dollars with Saudi riyals, and they may sell silver for dollars. This transaction is merely a book entry, such that neither the seller nor the buyer sees any of the currency, whether it is silver or dollars, and no physical exchange takes place between the two parties. What is the validity of this type of transaction?
Answer:
If this transaction does not involve taking possession, then the transaction is not valid. Transactions involving currency require taking possession, whether it is in dollars, Saudi riyals, dinars, British pounds, Egyptian pounds, or anything else. There must be an exchange, even if it is via book entry. If a person has dinars or dollars and sells them to Zayd or 'Amr via book entry or by phone, saying, "These dinars or dollars you have, which amount to such and such, I have sold them to you for such and such, and take possession," and he takes possession from himself, he becomes an agent; he takes possession of this money from himself, and there is no harm in that. However, if no taking possession has occurred, it is not valid, because the Messenger of Allah (peace and blessings be upon him) said, "Hand to hand,"Sahih Muslim 1584e and so on Sahih Muslim 1584d, then he said: Sahih Muslim 1587c.
So, dollars for British pounds must be hand to hand, and dollars for Saudi riyals must be hand to hand. If he says, "I sold you these dinars or these dollars for one hundred thousand Saudi riyals," and it is merely a book entry, and he did not hand over any money, then the sale is not valid. There must be an exchange.
The presenter: There must be an exchange. Is the exchange either physical or conceptual?
The Shaykh: A mere book entry does not constitute taking possession. The money must be taken possession of by the original owner of the money. If the purchase is in dollars from Zayd, then the equivalent must be delivered to Zayd. Whether it is with him, and he is present, and he says, "Take it from...," and he takes it from him, or he sends it to him, or he transfers it to a person so that he can take it from him, if the exchange takes place, the sale is completed; otherwise, it is not.
The presenter : May Allah reward you with good.
The listener Abdulrahman Ali Shalabi sent a question, saying: Some entities invest their funds in silver and dollars by buying dollars with Saudi riyals, and they may sell silver for dollars. This transaction is merely a book entry, such that neither the seller nor the buyer sees any of the currency, whether it is silver or dollars, and no physical exchange takes place between the two parties. What is the validity of this type of transaction?
Answer:
If this transaction does not involve taking possession, then the transaction is not valid. Transactions involving currency require taking possession, whether it is in dollars, Saudi riyals, dinars, British pounds, Egyptian pounds, or anything else. There must be an exchange, even if it is via book entry. If a person has dinars or dollars and sells them to Zayd or 'Amr via book entry or by phone, saying, "These dinars or dollars you have, which amount to such and such, I have sold them to you for such and such, and take possession," and he takes possession from himself, he becomes an agent; he takes possession of this money from himself, and there is no harm in that. However, if no taking possession has occurred, it is not valid, because the Messenger of Allah (peace and blessings be upon him) said, "Hand to hand,"
Gold is to be paid for by gold, silver by silver, wheat by wheat
الذهب بالذهب، والفضة بالفضة، والبر بالبرweight for weight or of the same quality
يدًا بيد مثلاً بمثل سواءً بسواءIf these classes differ, then sell as you wish if payment is made hand to hand.
فإذا اختلفت هذه الأصناف؛ فبيعوا كيف شئتم؛ إذا كان يدًا بيدSo, dollars for British pounds must be hand to hand, and dollars for Saudi riyals must be hand to hand. If he says, "I sold you these dinars or these dollars for one hundred thousand Saudi riyals," and it is merely a book entry, and he did not hand over any money, then the sale is not valid. There must be an exchange.
The presenter: There must be an exchange. Is the exchange either physical or conceptual?
The Shaykh: A mere book entry does not constitute taking possession. The money must be taken possession of by the original owner of the money. If the purchase is in dollars from Zayd, then the equivalent must be delivered to Zayd. Whether it is with him, and he is present, and he says, "Take it from...," and he takes it from him, or he sends it to him, or he transfers it to a person so that he can take it from him, if the exchange takes place, the sale is completed; otherwise, it is not.
The presenter : May Allah reward you with good.
Source
binbaz.org.sa
The Arabic text is copied verbatim from the original source, without any edits.