Ruling on Paying off Debt in a Different Currency

Answered according to Shafi'i Fiqh by Darul Iftaa Jordan
I have borrowed a certain sum in Syrian pound. Is it permissible for me to repay it in a different currency?


All perfect praise be to Allah the Lord of the Worlds. May His peace and blessings be upon our Prophet Mohammad and upon all his family and companions.

It is permissible for the debtor to pay off debt in a different currency under three conditions:

First: Adopting the exchange rate on day of repayment and not on the day the money was loaned.

Second: This wasn`t previously agreed upon. Rather, it was suggested to the debtor or creditor on the day of repayment. This is because agreeing on repayment in a different currency without doing so hand to hand isn’t permissible and  is called delay usury.

Third: After agreeing on repaying in a different currency, the whole amount of the debt must be paid at once and not in installments to avoid falling into delay usury because payment isn`t done on the spot. 

The evidence on the permissibility of repaying debt in a different currency is that it was narrated that Ibn 'Umar said: "I used to sell camels at Al-Baqi and I would sell Dinars in exchange for Dirhams. I came to the Prophet in the house of Hafsah and said: 'O Messenger of Allah, I want to ask you: I sell camels in Al-Baqi and I sell Dinars in exchange for Dirhams. He said: 'There is nothing wrong with it if you take the price on that day, unless you depart when there is still unfinished business between you both (buyer and seller)."'{Sunnan Atirmith and others}.

Resolution No.75,(8/6) of the International Islamic Fiqh Academy states: "It is permissible for the debtor and the creditor to reach an agreement, on the exact day of repayment, not before it, to pay off the debt in a different currency according to the exchange rate on that day. It is also permissible to repay an installment in a different currency according to the exchange rate on that day. In all situations, it is conditioned that the debtor pays off all the amounts he is liable for." And Allah the Almighty knows best.


This answer was collected from the official government Iftaa Department of Jordan.

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