I have gone through various Fatwa regarding the subject matter. It appears that a little clarity is needed. In fact the Forex trading is done through some broker or facilitator. The Forex Traders deposit the amount (called margin) with the broker before entering in the trade / business. After deposit of the margin (cash amount) trader is allowed to buy or sell different currencies on the internet. The amount of both the parties is with the Broker Company. As soon as a trade is finalized / closed, the software automatically and immediately debits / credits the accounts of both the traders i.e. buyer and seller. So the possession of goods (in this case currency) is genuinely transferred between the two parties by way of accounting entries by the software without even a second’s delay. Kindly give your verdict if the business in forex this way is Halal or Haram?
بسم الله الرحمن الرحيم
(Fatwa: 1340/1073/D=11/1434)
The method of currency trade mentioned in the question i.e. as soon as the deal is finalised, the currencies of both sides are transferred in the accounts of the buyer and seller. If this is the case, then this transaction is lawful as per the Shariah and its profit is halal.
Allah knows Best!
Darul Ifta,
Darul Uloom Deoband