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Search Fatawaa


Subject : It is Forbidden to Sell Gold through Murabaha or by Installments

Fatwa Number : 2852

Date : 10-11-2013

Classified : Transactions & Marketing

Fatwa Type : Search Fatawaa


Question :

What is ruling on purchasing gold through Islamic Murabaha transaction in favor of the customer?



The Answer :

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


Islam has set up special rules for gold and silver. Accordingly, these kinds must be analogous and exchanged in the same place hand by hand. Prophet Mohammad (PBUH) said: "Do not sell gold for gold, except like for like, and don't increase something of it upon something; and don't sell silver unless like for like, and don't increase something of it upon something, and do not sell for ready money something to be given later." {Muslim}. Al-Imam An-Nawawi stated: "There is a consensus among scholars that selling gold for gold or for silver which is to be given later is forbidden." {Sharh An Nawawi Ala Muslim, 11/10}.


Accordingly, it is forbidden to sell gold through Murabaha contract in favor of the customer because the price is to be given later, and not to be exchanged in the same place hand by hand. This is forbidden Riba (usury and interest) since cash and gold have value, which is the cause of Riba, and this is why it is forbidden to sell for ready money something to be given later. This rests on the Hadith where the Prophet (PBUH) said: "The bartering of gold for gold is Riba (usury), except if it is from hand to hand and equal in amount." And Allah knows best.







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