Inflation and Riba : effect of inflation on a loan

Fatawa Question

Dear Dr. Monzer, As-Salamu Alaykum Wa Rahmatu Allah WaBarakatu I hope this e-mail finds you in the best of health and Iman. Below is a financial question that I have from our community. Hosam-Canada I would like your insight into a matter for me. In 2008, I loaned $ 900.00 to my sister-in-law and amount they received was Rs.50,000.00 (at an exchange rate of $ 1.00 = Rs.55.00 approximately at that time). They had promised to return the funds in two months. However, that didn't happen. My sister-in-law’s husband lives in Australia. Now due to my financial situation, I am in need and I have asked them to return the funds to me. Pakistani currency, however has been declining and now equal of $ 1 = 96.00 Rupee approx. They insist that they should return Rs.50000.00 to me as they received about 4 years ago. I feel that it's unfair as I would receive about $ 520.00 only due to their currency devaluation. Had they returned the money sooner to me, it would be that much of difference. My intention is not to take advantage of them financially. Please let me know how much they should return to me. JazakAllah Khair, Imam Samy Ottawa main mosque

Fatwa

Click hereto view more

Publication Date

2012-12-12

Main Subjects

Financial and Accounting Sciences
Islamic Studies

Topics

• Islamic jurisprudence
• Inflation(Finance)
• Loans

No. of Pages

2

Data Type

Fatawa

Language

English

Record ID

BIM-730623

• APA
• MLA
• AMA