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Borrowing Money Across Borders

Answered according to Hanafi Fiqh by Qibla.com

Answered by Shaykh Faraz Rabbani

In 1960, I had borrowed R 40.00 from someone and subsequently forgot about it. How much do I repay now, R 40.00 or the present face-value?

Answer:
In the Name of Allah, Most Gracious, Most Merciful

Walaikum assalam,

One will have to repay R 40.00. Anything more will be interest, which is prohibited

In response to this answer- I just want to clarify an issue. If one has borrowed money from a relative/friend in the states a few years back and is now looking to repay it-does one pay the original amount in American or Canadian dollars? I mean since the worth of the American dollar has gone a lot higher than the time the money was borrowed, if one is going to pay the amount in American dollars then he would be paying much more than he borrowed, but the lender would get back the same amount. Or if they were to pay in Canadian dollars (the amount it transferred into at the time of borrowing) then they would pay back what they borrowed but the lender would get back less.

You have to re-pay the amount in the currency the loan was taken in. Otherwise, it would be riba.

Wassalam,
Faraz

This answer was indexed from Qibla.com, which used to have a repository of Islamic Q&A answered by various scholars. The website is no longer in existence. It has now been transformed into a learning portal with paid Islamic course offering under the brand of Kiflayn.

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