Riba in Sale/Exchange TransactionsT

Riba in Sale/Exchange Transactions

The last three traditions given above relate to the prohibition of Riba in sale or exchange contracts. In particular, the fifth tradition forms the basis of elaborate juristic rules on Riba prohibition in sale contracts and other exchange transactions. This type of Riba is termed “Riba Al-Fadl”.

Exchange rules are different for different contracts and types of assets. We have briefly discussed contracts in the preceding section. Assets could be consumables, durables, mon-etary units or media of exchange like gold, silver or other currencies, shares representing pools of assets, etc. Goods other than monetary units are traded on market-based pricing. Gold, silver or any monetary units (Athman) are governed by specific rules that have been discussed by jurists under the caption of Bai‘ al Sarf (sale of Athman). Usufructs and services are covered by the rules of Ijarah or Ujrah (leasing/hiring of services). Loans and debts are governed by the rules relating to their repayment and assignment.

The well-known Hadith on the exchange of six commodities and the other traditions about the exchange of low quality dates for a lesser amount of better quality dates deal with Riba in exchange transactions and have far-reaching implications in respect of business activities in the Islamic framework. Later jurists have extended the scope of this kind of Riba to other commodities on the basis of analogical reasoning (Qiyas)¯ and the ‘Illah (effective cause) of prohibition.

According to the rules of exchange of monetary units (Bai‘ al Sarf), if any article is sold for an article of the same kind, the exchange must be on the spot (without delay) and the articles must be equal in weight. In this context, jurists have held lengthy discussions, keeping in mind the two types of ‘Illah that play an effective role in the exchange: the unit of value (Thamaniyyah) and the edibility. The commentator of Sahih Muslim, Imam Nawavi has summarized these rules in the following way:

• When the underlying ‘Illah of the two goods being exchanged is different, shortfall/excess and delay both are permissible, e.g. the exchange of gold for wheat or dollars for a car.

• When the commodities of exchange are similar, excess and delay both are prohibited, e.g. gold for gold or wheat for wheat, dollars for dollars, etc.21

• When the commodities of exchange are heterogeneous but the ‘Illah is the same, as in the case of exchanging gold for silver or US Dollars for Japanese Yen (medium of exchange) or wheat for rice (the ‘Illah being edibility), then excess/deficiency is allowed, but delay in exchange is not allowed.

In the present scenario, the major ‘Illah, or cause, on the basis of which one may extend the rules of Riba to other commodities by analogy is their being used in lieu of money. There is consensus among scholars that the rules of Riba apply to anything that serves the function of money. This may be gold, silver, any paper currency or IOUs.

Connotation of the Term Riba

On the basis of the above detailed discussion, we are now in a position to explain what the term Riba connotes in the perspective of present-day business and finance. The literal meaning of Riba is excess and in the terminology of the Shar¯ı´ah, it means an addition, however slight, over and above the principal of a loan or debt. Nasiah means delay or delaying the delivery of a commodity in a contract. The term Riba Al-Nasiah, therefore,means the benefit or excess that arises from the delay of counter value in an exchange based on loans or sales. More precisely, it is the potential benefit to be derived during the period of delay stipulated for either of the exchanged/counter currency values. Riba Al-Nasiah relates to loan transactions and is also termed Riba Al-Qur’an¯. Riba Al-Fadl that relates to exchange/sale transactions is the quality premium in the exchange of low quality for better quality goods of the same genus, e.g. in the exchange of dates for dates, wheat for wheat, etc.

Hence, Riba includes both usury and interest as used in modern commercial terminology. The word “interest” by and large has now been accepted and is understood as Riba. Con-ventional banks’ loan transactions carrying interest involve both Riba Al-Nasiah and Riba Al-Fadl – an extra amount of money is paid at the time when payment becomes due as per the loan contract.

Keeping in mind all types of transaction, a broader definition of Riba would be the following:

“Riba means and includes any increase over and above the principal amount payable in a contract obligation, not covered by a corresponding increase in labour, commodity, risk or expertise.”

This definition requires that all accruals should correspond to liability and risk and excludes from Riba the profit charged in trading and Shirkah, commission or service charged in Ujrah and Wakalah and the rentals charged in Ijarah.

Results (Indonesian) 1:

Riba dalam transaksi jual/ExchangeTradisi-tradisi tiga terakhir yang diberikan di atas berhubungan dengan pelarangan Riba dalam kontrak penjualan atau asing. Secara khusus, tradisi kelima membentuk dasar rumit mazhab peraturan tentang pelarangan Riba di kontrak penjualan dan transaksi asing lainnya. Riba jenis ini disebut "Riba Al-negeri".Peraturan berbeda untuk kontrak yang berbeda dan jenis aset. Kita telah secara singkat membahas kontrak dalam bagian sebelumnya. Aset bisa habis, tahan lama, unit mon-etary atau pertukaran media seperti emas, perak atau mata uang, saham yang mewakili kolam aset, dll. Barang selain unit moneter diperdagangkan pada berbasis pasar harga. Emas, perak atau setiap unit moneter (Athman) diatur oleh peraturan yang spesifik bahwa telah dibahas oleh ahli hukum di bawah judul Bai' al Sarf (penjualan Athman). Hasil berbentuk multi-form dan layanan dilindungi oleh peraturan Ijarah atau Ujrah (sewa/menyewa layanan). Pinjaman dan utang diatur oleh peraturan-peraturan yang terkait dengan pembayaran dan tugas mereka.Hadis terkenal pertukaran enam komoditas dan aliran-aliran lain tentang pertukaran kualitas rendah tanggal untuk jumlah yang lebih kecil lebih baik kualitas tanggal berurusan dengan Riba di exchange transaksi dan memiliki implikasi luas sehubungan dengan kegiatan usaha dalam rangka Islam. Kemudian ahli hukum telah memperluas cakupan semacam ini riba untuk komoditas lain berdasarkan analogis ¯ penalaran (Qiyas) dan ' Illah (efektif menyebabkan) larangan.Menurut aturan pertukaran moneter unit (Bai' al Sarf), jika setiap artikel dijual untuk sebuah artikel yang sama jenis, pertukaran harus di tempat (tanpa penundaan) dan artikel harus sama berat. Dalam konteks ini, ahli hukum telah diselenggarakan diskusi yang panjang, mengingat dua jenis ' Illah yang memainkan peran yang efektif dalam Asing: unit nilai (Thamaniyyah) dan edibility. Komentator Sahih Muslim, Imam Nawavi telah diringkas aturan-aturan ini dengan cara sebagai berikut:• Ketika yang mendasari ' Illah barang dua sedang ditukar berbeda, kekurangan kelebihan dan penundaan yang diperbolehkan, misalnya pertukaran emas untuk gandum atau dolar untuk sebuah mobil.• Ketika komoditi pertukaran serupa, kelebihan dan menunda kedua yang dilarang, misalnya emas untuk emas atau gandum untuk gandum, dolar untuk dolar, etc.21• Ketika komoditi pertukaran heterogen tetapi ' Illah adalah sama, seperti dalam kasus bertukar emas Silver atau dolar AS untuk Yen Jepang (tukar) atau gandum untuk beras (' Illah menjadi edibility), maka kelebihan kekurangan diperbolehkan, tetapi penundaan dalam asing tidak diperbolehkan.Dalam skenario ini, utama ' Illah, atau penyebab, atas dasar yang satu dapat memperpanjang aturan riba untuk komoditas lain dengan analogi adalah mereka digunakan sebagai pengganti uang. Ada konsensus di antara ulama yang berlaku aturan Riba untuk apa pun yang melayani fungsi uang. Ini mungkin menjadi emas, perak, mata uang kertas atau berlaku untuk berbagai.Connotation of the Term RibaOn the basis of the above detailed discussion, we are now in a position to explain what the term Riba connotes in the perspective of present-day business and finance. The literal meaning of Riba is excess and in the terminology of the Shar¯ı´ah, it means an addition, however slight, over and above the principal of a loan or debt. Nasiah means delay or delaying the delivery of a commodity in a contract. The term Riba Al-Nasiah, therefore,means the benefit or excess that arises from the delay of counter value in an exchange based on loans or sales. More precisely, it is the potential benefit to be derived during the period of delay stipulated for either of the exchanged/counter currency values. Riba Al-Nasiah relates to loan transactions and is also termed Riba Al-Qur’an¯. Riba Al-Fadl that relates to exchange/sale transactions is the quality premium in the exchange of low quality for better quality goods of the same genus, e.g. in the exchange of dates for dates, wheat for wheat, etc.Hence, Riba includes both usury and interest as used in modern commercial terminology. The word “interest” by and large has now been accepted and is understood as Riba. Con-ventional banks’ loan transactions carrying interest involve both Riba Al-Nasiah and Riba Al-Fadl – an extra amount of money is paid at the time when payment becomes due as per the loan contract.Keeping in mind all types of transaction, a broader definition of Riba would be the following:“Riba means and includes any increase over and above the principal amount payable in a contract obligation, not covered by a corresponding increase in labour, commodity, risk or expertise.”This definition requires that all accruals should correspond to liability and risk and excludes from Riba the profit charged in trading and Shirkah, commission or service charged in Ujrah and Wakalah and the rentals charged in Ijarah.