A loan must be paid as taken, and if not possible, the value is to be estimated
Fatwa No: 7110

  • Fatwa Date:29-1-2014 - Rabee' Al-Awwal 28, 1435
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Question

In 1990, I lent nearly 150,000 dollars to a person, and he wants to pay me this year, 2001, while the sum is now equal to only 1500 dollars. When I lent him the money I did not agree with him on which currency he would pay me, whether by the dollar or by the local currency. The local currency at that time was the Sudanese pound and now it is the Sudanese dinar. Please advise. Thanks.

Answer

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad, sallallaahu ‘alayhi wa sallam, is His Slave and Messenger.

It seems from your question that you lent that person Sudanese pounds that were equal to 150,000 dollars, and because the value of the Sudanese pound decreased, the amount has been reduced to what equals 1500 dollars. You ask whether he should pay you back in the same currency, regardless of the value of the sum in both cases, or if he should consider the value.

In fact, scholars of Fiqh stated that a debtor is required to clear his financial liability in view of the time when he borrowed the money, regardless of the value at the time of settling the debt, whether or not the value increased when he received the money.

However, if the currency owed by a debtor is abolished, or he owed clothes which are not available any more, or owed something of the sort, then he is liable to the value of the debt which is due yet cannot be settled as was the original item.

As such, your debtor is required to pay you the value of the Sudanese pounds that you demand from him, considering the value of the Sudanese pound when it was officially cancelled and replaced by the dinar.

In addition, there are two points that should be considered by loan givers and recipients. They should be applied with perfection and in the way that is most loveable to Allaah, for seeking His pleasure and getting exposed to His mercy, as supplicated by the Prophet, sallallaahu ‘alayhi wa sallam: “May Allaah Have mercy on a man who is easygoing when he buys, when he sells and when he asks for payment.

First, lending is a practice of righteousness that is done with the intention of drawing oneself closer to Allaah, hoping for double reward, for by means of which the lender shows leniency, provides help, fulfills the needs of Muslims and thus relieves their financial constraints. Hence, the Muslim should consider the issue of lending from this perspective, bearing these objectives in mind. In the meantime, he should not regard the lending as a way to achieve material gains so as to develop his wealth.

As a lender, you should seek reward from Allaah, The Almighty. You should not be sad for the outward reduction of the money that you had lent, for hopefully Allaah Will Double and Save it for you, on a day when you will need it more than you need it now.

Second, a debtor should be a good payer and magnanimous in rewarding the creditor for his favor, so as to expose himself to the Mercy of Allaah, The Almighty, as supplicated by the Prophet, sallallaahu ‘alayhi wa sallam, in the previous Hadeeth and to follow his example.

It was narrated that the Prophet, sallallaahu ‘alayhi wa sallam, borrowed a middle-aged camel from a man. When he was provided with some camels from the camels of charity, he ordered Abu Raafi' to give the man his camel. Abu Raafi' said, “I did not find but a better and older camel.” Therefore, the Prophet, sallallaahu ‘alayhi wa sallam, said: “Give it to him. The most righteous of people are those who are the best in the payment of debt.” [Muslim]

Consequently, there is no harm that your debtor considers the decrease in the amount which he owes to you, and gives you what is available with him and suitable for his conditions.

Allaah Knows best.

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