Ruling on Selling Silver Riyals with an Increase in Paper Riyals

Author: Dr. Muhammad Zia-ur-Rahman Azmi (رحمه الله)

Issue:​

What is the ruling on selling silver Riyals in exchange for paper Riyals with an additional amount?

This issue is debated among contemporary scholars:

1. Some scholars firmly permit it, arguing that paper money is not the same as silver and, therefore, does not fall under the prohibition of Riba (usury).
2. Others prohibit it, stating that paper currency functions as a medium of exchange, similar to silver, and thus should be subject to the same rules as silver in transactions.

Personal View & Preferred Approach:​

To this day, I (Dr. Muhammad Zia-ur-Rahman Azmi) remain unconvinced by either of these views. In my opinion, the safest approach is to avoid such transactions altogether. This is in accordance with the Prophet’s ﷺ guidance:

"Leave that which makes you doubt for that which does not make you doubt."
[Sunan At-Tirmidhi, Hadith No. 2518 | Sunan An-Nasa'i, Hadith No. 5711]

The Prophet ﷺ also said:

"Whoever avoids doubtful matters has safeguarded his religion and his honor."
[Sunan Abi Dawood, Hadith No. 3330]

Additionally, he ﷺ stated:

"Righteousness is good character, and sin is what troubles your heart and what you dislike others to know."
[Sahih Muslim, Hadith No. 2553/14]

Recommended Precautionary Method:​

In cases like this, it is best to follow a more cautious approach:

1. If someone wants to sell silver, they should exchange it for another commodity, such as gold or something similar. Then, they can use the proceeds to purchase paper currency.
2. If someone with paper currency wants to buy silver, they should first exchange their paper money for gold or another similar commodity, and then use that to buy the silver they desire.

This approach eliminates any potential issues of Riba (usury) and financial ambiguity.

[Shaykh Ibn Baz: Majmoo’ al-Fatawa wal-Maqalat, 19/166]