• Enter your email address to follow this blog and receive notifications of new posts by email.

  • Ayn Gold & UK Open Markets

  • RSS The Consultant’s View – Articles & Audio Files

    • Calling The Twice Removed
      AVAILABLE NOW FROM THE PUBLISHERS: There is no reversal, no going back! That “second removal,” a mass migration from the Caribbean colonies of young men and women coming to help the ‘motherland’, to... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social […]
    • How to Raise £3,000 (or $5,000) in Just 30 Days
      It will be obvious to many that £3,000 is not a lot of money for a big charity or major corporation. Conversely, for many very small organisations that may be  more than they raise in a whole year.... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social e […]
    • Let’s Not Leave any EU Money on the Table
       Do You Have a Mind To Access Some European Union Funding – Before It’s Too Late? If you and your organisation support young people in any way then you could be leaving accessible... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social enterprise or runn […]
    • How To Train Like an Olympic Athlete for Business Greatness
      I am not quite an obsessive sports fanatic, but I certainly love playing and watching an array of sports. From the pure sports of athletics and boxing to the more contrived sports of Formula 1 motor... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social […]
    • Business Psychology: Lessons from Formula 1 Racing
      In a recent post I stated that Formula 1 Racing was not a pure sport because of the heavy reliance on technology in terms of driver performance. However, despite that I still find it a fascinating... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social en […]
    • Five Immediate Actions to Increase Sales and Grow Your Business
      In terms of my physical health It’s not unknown to me that I really should exercise more and cut out certain foods. It takes very little effort to find that out. identifying the things I... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social enterprise o […]
    • WHERE’S YOUR BUSINESS AT? The Three Stages of a Commercial Enterprise
      Ask anyone to recommend you a business role model that you can emulate and you might get a range  of answers. From Richard Branson, Bernie Madoff, Bill Gates, Alan Sugar, Aliko Dangote or George... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social ente […]
    • Top 40 Lead Generation Techniques
      Lead Generation – The Great Start Lead generation is one of the Five Business Improvement and Optimisation Action Points that form part of the Olympic Sprint Business Coaching method. In... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social enterprise o […]
    • Crypto Currencies: Bubble or Best Thing Ever?
      In a recent webinar I tried to explain the Blockchain technology behind Bitcoin and other so called crypto currencies. I likened it to a group conversation on the WhatsApp platform. I’ve... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social enterprise o […]
    • 10 Things I Learned Directly From Alan Sugar
      I used to be an avid watcher of The Apprentice. Nowadays I might watch one or two episodes, makes a cursory assessment of the uselessness, or not, of each candidate and then keep an eye out for when... Short, sharp and straight forward advice for anyone wanting to satisfy their enterprising and entrepreneurial spirit, whether through self-employment, social […]
  • Advertisements

Tommy Robinson: Muhammad’s Qur’an – Why Muslims Kill

One can assume that the primary purpose of writing and publishing a book with such a title at this time in the UK is for financial benefit. Nothing wrong with that. In fact the author’s EDL credentials may distinguish it from the glut of anti-Muslim and fearmongering literature that is being churned out. 

Is it a coincidence that Tommy Robinson developed such strong links with the Quilliam Foundation, a Muslim organisation with a widespread reputation of being itself very anti-Islam. Weird isn’t it? Or maybe not.

What will Mr Robinson say in his book? Presumably he will correct those who insist on saying, and those who believe that the word “islam” means “peace” when in fact it means “submission”.  He may even point out that submitting to the will of Allah does sometimes mean fighting. He may talk of capital punishment & executions. He may talk of floggings and amputations. No doubt he will take and even make interpretations from the Qur’an so similar to that of the wahabis/salafis. Can we blame him? Perhaps there will be also shia interpretations. 

We know that there will be no shortage of modern examples to back up his writing and that most of them will be attributed to ISIS, the al-Qaeda and mentally unstable individuals who have blown themselves up. 

With so many Muslims openly and vocally attacking those who celebrate the mawlid he will not be aware just how much Muslims across the world love and try to emulate the Prophet Muhammad, peace be upon him.

He won’t be able to mention the system of social and financial justice that Is inherent in Isam because he will not have heard Muslims talking about Zakat, Awqaf, markets, gold & silver currency and fair contracts. Mind you, how many Muslims talk about these things or understand their importance? So he won’t know that Islam really is the answer for those who want to put Britain first and that these characteristics of the deen naturally tackle the poverty trap, support entrepreneurship and both wealth creation and wealth distribution. That it tackles unemployment, financial justice, social exclusion, exploitation and encourages charity. Though to be honest Muslims in Libya, Yemen, Sudan and elsewhere and their savage treatment and exploitation of African migrants (muslim or not) has not been a great example but I doubt if these would warrant a mention in his book,  phew! Though he may have picked up on deeply embedded racist attitudes in many British muslim communities, but that shouldn’t bother him.

It is now time  to realise that Islam does in fact have teeth, it’s not about a utopian society but about establishing social and financial justice. It recognises that people do bad things, that there are in equalities and gives us a way to deal with these things justly and calls us to the highest of human behaviour. It recognises that forgiveness is great but retaliation is certainly acceptable and sometime advisable. He can’t know all this, and Muslims in the UK can only blame themselves. Firstly for not learning the transformative reality of the Deen. Secondly for separating the inward aspect of Islam (Ihsan/tazkiya/tassawuf) from the outward (fiqh/shariah), but also for not telling those we meet of the beauty of Islam while showing our fear and hope from Allah linked to our love of his noble prophet, peace be upon him. 

Allah is most certainly the Best of Planners and we ask that all of this be part of the spread of Islam in Britain and amongst the people who live there. 


Introducing the New British Islamic Silver Coin

The Deen is Easy – Let’s Keep it that Way

From Abu Hurairah ‘Abd ar-Rahman ibn Sakhr, may Allah be pleased with him, that he said, “I heard the Messenger of Allah, may Allah bless with him and grant him peace, saying, “That which I forbid you, avoid it, and that which I command you, do of it that which you are able, for the only thing that destroyed the ones who were before you was their great numbers of questions and their disagreements with their prophets.” Al-Bukhari and Muslim narrated it

So, there we have it. It’s simple! We just have to find those things Allah has commanded us to do and get on kelantan_1_dirham_backwith them and find out what Allah has prohibited and avoid them. A good starting point in terms of command is obviously the five pillars of Islam,namely: shahada, salat, zakat, sawm and hajj.

In terms of what to avoid the obvious starting point would be those things Allah is most fierce about such as shirk and riba. No need for constitutions or great policy statements. As individuals we declare the shahada, do our prayers in the right time & place, pay our zakat to the right person in the right form, fast on the correct dates and perform the hajj if able. In terms of prohibition we learn enough tawhid to avoid accidental shirk and we are careful about our speech, We are careful to not impose riba on anyone and we try and extract ourselves one step at a time from it.

However, for some that is not enough, we want more. This means teaching the deen and calling people to the burnedshahada. This means actually establishing the place of prayer and appointing imams to lead the prayer. It means establishing the local collection and distribution of zakat in gold and silver currency. It means putting in place the mechanisms that allow the correct announcement for the beginning of Ramadan, and it means hajj in jam’at.

Then in order to get the balance right we have to take on Ihsan. For in the famous Hadith of Gibril we are taught that the true deen consists of Islam, Iman and Ihsan. Through learning and the shahada we have had to take on the knowledge of iman or tawhid. Then with the five pillars and the prohibitions we are taking on the science of islam. So now we need to add ihsan, this worshipping Allah as if you see him. This taking on good behaviour and leaving behind bad behaviour, sometimes called the science of tazkiya or tasssawuf.

So now we can get on with it!

individually or collectively, as a ordinary person or a leader we know enough.

May Allah give us success.

Critique of a Charity’s Attempt to Collect Zakat

With the start of the new Islamic year upon us, I was reminded of a document that I had recently been given, and asked for my views concerning it. A document entitled: A Brief Guide to Zakat in the UK. It was produced by a Suffolk based charity in the UK. Of course from my own book written with Shaykh Abdalhaqq Bewley (Zakat – Raising a Fallen Pillar) and many subsequent writings and conversations, many will know that I don’t generally approve of charities taking on the collection of Zakat. In reality the pillar of Zakat requires a person in authority to be at the centre of it. If this person is backed up by a charity, then all well and good. For the moment we can overlook this as I want to concentrate on reviewing some of the other stances or methodologies that The Charity has adopted.

The Charity document has 6 pages. On page 1 they quite correctly state the great importance of sadaqa sent abroad to help needy Muslims and/or relatives. However, they quite rightly make a clear distinction between this and Zakat. Pleasingly they stress the fact that Zakat is to be collected and distributed locally and that sending it abroad is at best mukruh (disliked) except under very special circumstances. Indeed, on page 2 they offer evidence from the four madhabs to support this stance. This in itself is of utmost importance in that they have not fallen victim to the anti/non-madhabi stance that characterise the modernists, who have all but abandoned the deen.

The document continues on page 2 to outline some important characteristics needed for the collection and distribution of zakat, namely, ‘.. honest, reliable and competent..” So far so good, but unfortunately these words are followed by the word “organisations.” So here they have missed a trick. The deen was not established by organisations. The collection and distribution of Zakat is authorised by people in authority, amirs, governors, sultans and the like.

Committees and Boards of Trustees cannot do it. Look at those things a Muslim leader is entrusted with such as announcing the two eids (thus the beginning and end of Ramadan), minting the gold dinar and silver dirham, appointing Imams to lead the prayer, maintaining the weights & measures in the marketplace and of course the collection and distribution of Zakat. These thing are the responsibility of the man in charge and backed up by advisors, deputies or lieutenants and so on. He can even be supported by charitable institutions/awaqf like The Charity in question.

To their credit the author(s) get back on track on page 3 when clarifying who should pay Zakat and quite clearly address the issue of minors. The document also clarifies when Zakat is due (anytime really) and that it is not connected to Ramadan and thus not to be confused with Zakat-al-Fitr which is an obligation connected to fasting in Ramadan. Also on page 4 they address the nisab on monetary wealth which is either 20 gold dinars or 200 silver dirhams. They equate this to 40 ounces of silver. However in reality this is in fact closer to 19 troy ounces of silver and nearly 3 troy ounces of gold. It is perhaps easy to see why this mistake may have been made.

Firstly, not many people do the necessary research to establish what a dinar or dirham actually is. Today in many countries around the world Islamic Gold Dinars and Islamic Silver Dirhams are being minted under the auspices of the World Islamic Mint (WIM) according to the standards established by Umar ibn Al-Khattab. This includes the correlation specified between the Dinar and Dirham (that 7 dinars is the weight of 10 dirhams). hence we have a weight of 4.25 grams for a Gold Dinar and 2.975 grams for a Silver Dirham. So in weight the nisab would be 85 grams of gold or 595 grams of silver. Of course one should also work out the cost of obtaining a Silver Dirham or Gold Dinar in your locality and work it out on that price. In the UK the best place to look is on the Ayn Gold website.

It is interesting that they (The Charity) have decided to stick to the nisab of silver. This means that more people will be eligible to pay zakat as opposed to if the nisab of gold was taken. So at the time of writing anyone holding savings of around £1,000 (for over a year) would have to pay as opposed to well over £3,000 if the gold nisab were used. In my own community some years ago we made the decision to use the gold nisab. It was reasoned that this would avoid less well-off people having to pay, due to the depressed price of silver. However, I think that here The Charity have a much more authentic position by opting for silver in this matter. They do though, need to be aware of the current availability of actual silver dirhams in the UK and even the movement to have them used as currency. All of this is perhaps an indication that affairs of muamalat that involve daily commerce and other transactions tend not to be given the importance they are due. This is further evidenced by the fact that the document does not address the issue of Zakat on business stock or investments.

The Charity document quite correcly quotes from Surah Tawba the categories of person who may receive Zakat “These categories are the poor, the needy, workers in zakat, people whose hearts are to be reconciled (mu’allafat quloobuhum), captives, debtors, in the cause of Allah and wayfarers (travellers).”

Although not made clear it seems that The Charity are well aware that Zakat cannot be used to build mosques, schools or clinics and other similar noble causes.They are clear that it must be given to individuals in one of the eight categories mentioned. They are also well aware of the need to distribute Zakat locally. These two things by themselves are a great improvement and step forward that we hope will be replicated by other Muslim led charities. So for this the people involved with This Charity deserve great credit.

Sadly what has not been addressed is the matter of Muslim leadership, without which the pillar of Zakat can never truly be implemented properly. They have also failed to address the requirement to pay Zakat on monetary wealth in, Ayn or tangible wealth. In this case gold or silver (preferably dinars or dirhams) They are of course on shaky ground in assuming that paying in bank issued paper money is acceptable, but perhaps we will see something more on these matters at a later date.

May Allah grant us all Success establishing Zakat, abandoning riba, and being a part of bringing Allah’s Deen to life in the lands where we find ourselves.


Statement On the Shariah Currency and Legal Tender

Shariah Counselor of World Islamic Mint and Former Imam of the Great Mosque of Granada
Kuala Lumpur, 16th of August 2010
(posted courtesy of Gold Dinar & Muamalat Blog)

Bismillah irrahman irrahim
Regarding the matter of the Gold Dinar and Silver Dirham and Legal Tender in Malaysia

The Gold Dinar and Silver Dirham known as Shariah currency or Shariah coins in the Fiqh are not legal tender. The Shariah currency has no relation to present fiat currencies on many accounts and should not be legally or practically be compared or treated as the same. The Gold Dinar and Silver Dirham relates to religious matters, most important of which is the matter of payment of Zakat, rather than constitutional matters. Its introduction can only occurred on voluntary basis since freedom is a command from Allah in all commercial transactions including the acceptance of money. Its usage has been throughout history open to Muslim and non-Muslims alike.

All Praise is due to Allah, the most Compassionate, the most Merciful, the Lord of all the worlds, the King of the Day of Judgment, Who has gathered all knowledge in His Essence and Who is the Creator of all knowledge for eternity. All peace and blessings be upon His beloved Prophet, Muhammad, who was not taught by man but by Him, He was the last and most honored Prophet, the last in the chain of prophethood that was brought to this world and has guided us to the right path. May abundant peace and blessing be upon his Family and his Companions, who were chosen among the good and benevolent.
In relation to the present concern of the people regarding the Launching of the Shariah currency in the State of Kelantan on the last 2nd of Ramadhan 1431, as a witness of the momentous ceremony of the Launching in the city of Kota Bharu and as Shariah Counselor of World Islamic Mint, I would like to state in a manner of clarification and support to this initiative the following:

1.- The Gold Dinar and Silver Dirham are not legal tender. Legal tender or forced tender is an offered payment that, by law, cannot be refused in settlement of a debt, and have the debt remain in force. Personal cheques, credit cards, debit cards and similar non-cash methods of payment are not legal tender only the notes and coins of Malaysia are Legal Tender. The issuing of Legal Tender is the exclusive prerogative of the Federal Government and the Government of Kelantan never had nor has the intention to issue Legal Tender as that is legally impossible.
2.- The Dinar and the Dirham are known in the fiqh (see [a] Muqaddimah of ibn Khaldun) as the “Shariah currency”or “Shariah coins”. The term “Shariah coins” is specific to the Dinar and Dirham and is not applicable to any other coin made in gold, silver or any other material. Any other coin is known as “non-shari’i” (ibn Khaldun).

3.-Properly speaking the term “alternative currency” is not applicable to the Shariah coins or currency because the term “Shariah coins” is specific to the Dinar and Dirham and therefore is not alternative to any other coins or currency (non shari’i). It stands on its own without alternative. The use of the expression “alternative currency” can only be used if proper explanation is given in regards to the fundamental differences that exist in relation to the legal tender currencies such as the Malaysian Ringgit. The Malaysian Ringgit is an entirely different legal concept and has different functions. The Malaysian Ringgit is not based on a commodity (in Arabic ‘ayn, meaning tangible merchandise) like the Dinar and Dirham, the Malaysian Ringgit a promissory note (in Arabic dayn, meaning debt or liability) with no intrinsic value (its value as ‘ayn/tangible merchandise is the value of the paper close to zero) but with a fiat value which established by the compulsion law of the Federal Government through the Law of Legal Tender and it can change from time to time. On the other hand, the value of the Dinar and Dirham depends entirely on the market value of the commodity (gold and silver) on which it is manufactured, just like a kilo of rice depends on the value of rice. This difference in important in religious terms, for example, zakat which is a legal obligation of the Shariah has to be paid in ‘ayn but cannot be paid in dayn. (see [b] Al-Kasani). Muslims should, if having the choice(if no choice is given or no ‘ayn is available then darurah, that is exceptionality, is temporarily applicable), pay with ‘ayn rather than dayn.

5.- In linguistic sense, the Dinar and Dirham are not face values, but names that indicate specific weights. The Dinar is a specific weight of 4.25 grams and it is also known as mithqal in Arabic. The Dirham is a specific weight of 2.975 grams or 7/10 of the mithqal. In a way they are legally the same as saying “1kg of rice”. Therefore they are specific weights of commodity (gold and silver) which are mentioned in Qur’an and in many aspects of the Shariah regarding zakat and legal judgments; and thus they cannot be altered in their weight.

6.- In history, the Shariah coins has never been legal tender. In the practice of the early Muslim community the Shariah coins were not only currency used as means of payment. Barley, dates or salt were also used as means of payment and therefore no exclusive right was given to the Shariah coins. The reason for this “freedom to choose the medium of exchange” is that money is considered a part of trading it is regulated under the same Qur’anic injunction that regulates trade: “tijaratun ‘aan taradim minkum”, the meaning of which is “trade according to mutual consent”. “Mutual consent” excludes the idea of compulsion or monopoly in regards to trading. (see [c] Tafsir al-Jalalayn). This is another reason why the Dinar and Dirham are not legal tender and have never been legal tender. Freedom to choose the medium of exchange is a fundamental right granted by Allah to Muslims and non-Muslims alike. The use of the Shariah currency is therefore inclusive of non-Muslims.

7.-The term “currency” is commonly understood as legal tender or as fiat money that carries a face value. Since the “Shariah coins” are not legal tender and do not have a face value the” Shariah coins” should be better understood as a commodity rather than as “currency” in the common use of the term. Regarding current common practices, the use of the “Shariah coins” belongs to the category of barter, that is, the mutual exchange of products and services. It is arguable that in the past, before the introduction of legal tender laws, transactions made with gold and silver were consider normal transactions and the term barter was applicable to all other transactions. Therefore the use of the term “Shariah currency” should be understood with the limitations explained above and in consideration to the historical practice of the Muslims as it is relevant in the Islamic Jurisprudence.

8.- Until very recently in history “paper currencies” were defined as promissory notes in terms of gold and silver. In that sense they represented an ‘amanah’ (trusting wealth to someone who will keep it for you until you demand it) that is an obligation to pay on demand a certain amount of gold and silver. We know from history that this obligation was often not fulfilled and eventually the governments of the world decided gradually to eliminate the obligation to pay in specie altogether. The closest case of the default is the US dollar and its unilateral decision to break their “Bretton Woods Agreement”. This concept of ‘broken amanah’ is known in the Qur’an and carries legal implications as to the prohibition to accept amanah from non-Muslims unless they live under Muslim rule so that they can be obliged to pay their contractual obligations (see [d] Qadi Abu Bakr ibn al-Arabi). This legal injunction, which in theory implies the prohibition to accept British pounds, US dollars, etc. ( or any other currency backed by them), has been abrogated long ago since the colonial days by new laws that consider that this legal injunction is no longer applicable. Under the inspiration of the colonial legal systems, the constitutional Law of all Muslim countries including Malaysia grants the right to accept foreign promissory notes from non-Muslim countries (such as USD) to their own Central Bank (Bank Negara) as a reserve value for their own fiat currency. Because of this many Muslims (and non-Muslims) still mistakenly belief that their own fiat currency is backed by gold and silver when in fact no legal tender in the world is fully backed by specie anymore. The gold dinar and silver dirham are commodities and therefore they are not an ‘amanah: they are a tangible commodity (‘ayn), that is, when you pay with them, you hand over a certain amount of gold and silver and therefore they do not require to be backed by any other asset or authority other than itself. This is another reason why the Shariah currency cannot be compared or considered an alternative to “paper currencies”.

9.- Legal Tender is often a misunderstood concept. Coins and banknotes do not need to be ‘legal tender’ in order to be used as money to buy and perform other transactions for which money is intended. Legal tender must be accepted to settle a money debt. For example, US federal law does not restrict private businesses, persons or organisations in what methods of payment they choose to accept or refuse. Businesses are therefore free to insist on payment by credit card, for example, or to refuse larger denomination banknotes. In Canada for example, only Canadian dollar banknotes issued by the Bank of Canada are legal tender; however, commercial transactions may legally be settled in any manner agreed by the parties involved. A significant amount of business in Canada is transacted in United States dollars, despite United States currency not being legal tender. Legal tender can be refused unless or until a person is in debt, therefore vending machines and transport staff do not have to accept the largest denomination of banknote for a single bus fare or bar of chocolate, and even shopkeepers can reject large banknotes. However, restaurants that do not collect money until after a meal is served (a debt has been created) would have to accept any legal tender. The right of a trader to refuse to do business with any person means a purchaser cannot demand to make a purchase, and so declaring a legal tender other than for debts would be redundant.

10.- The minting of the Dinar and Dirham is a known practice of the Muslims from the early days of Islam. The first dated coins that can be assigned to the Muslims are copies of silver dirhams of the Sasanian Yezdigird III, struck during the Khalifate of Uthman, radiallahu anhu. These coins differ from the original ones in that an Arabic inscription is found in the obverse margins, normally reading “in the name of Allah”. Since then the writing in Arabic of the name of Allah and parts of Qur’an on the coins became a custom in all minting made by Muslims. In the year 75 (695) the Khalif Abdalmalik ordered Al-Haddjadj to mint the first dirhams, officially establishing the standard of Umar ibn al-Khattab, radiallahu anhu: 7/10 of the mithqal. The next year he ordered the dirhams to be minted in all the regions of the Dar al-Islam. He ordered the coins to be stamped with the sentence: “Allahu Ahad, Allahu Samad”. The minting of the coins is considered an obligation of the Sultan that needs to be followed (see [e] al-Qurtubi).
And Victory belongs to Allah. In Him we trust and praise belong to the Lord of the worlds and peace and blessings on His Messenger.
The slave of Allah, Hajj Abdalhasib Castineira, in Kuala Lumpur, on the 5th of Ramadhan, 1431.


A] Imam Abu Zayd Ibn Khaldun (d. 1406)
“The Revelation undertook to mention them and attached many judgments to them, for example zakat, marriage, and hudud. Therefore within the Revelation they have to have a reality and specific measure for assessment (of zakat, etc.) upon which its judgments may be based rather than on the non-shari’i (other coins).
Know that there is a consensus (ijma) since the beginning of Islam and the age of the Companions and the Followers that the dirham of the shari’ah is that of which ten weigh seven mithqals (weight of the dinar) of gold… The weight of a mithqal is seventy-two grains of barley, so that the dirham which is seven tenths of it is fifty and two fifths grains. All these measurements are firmly established by consensus.”

B] Imam Abu Bakr al-Kasani ( d.1191)
“If the property on which zakat fell due is dayn, as distinguished from ‘ayn, its zakat may be settled in terms of ‘ayn wealth. Thus a person having a claim of two hundred dirhams on which zakat is due, may give, in settlement of the same, five dirhams in cash, because dayn as compared with ‘ayn is defective (naqis) and the ‘ayn is complete (kamil), and a settlement of the defective in terms of the complete is valid. On the contrary, the settlement of the complete ‘ayn in terms of the defective (dayn) is not valid, and therefore, the zakat debt is not discharged if a person wants to pay the zakat of two hundred dirhams which he possesses (i.e. ‘ayn) in terms of the five dirhams which a poor person owes him (i.e. dayn); namely, by absolving him from the debt intending it for his own zakat debt on the two hundred dirhams.”
“Bada’i` al-Sana’i”

C] Shaykh Jalaluddin al-Mahalli & Shaykh Jalaluddin al-Suyuti

Allah says in the Qur’an (4, 29):
{ يَٰأَيُّهَا ٱلَّذِينَ آمَنُواْ لاَ تَأْكُلُوۤاْ أَمْوَٰلَكُمْ بَيْنَكُمْ بِٱلْبَٰطِلِ إِلاَّ أَن تَكُونَ تِجَٰرَةً عَن تَرَاضٍ مِّنْكُمْ وَلاَ تَقْتُلُوۤاْ أَنْفُسَكُمْ إِنَّ ٱللَّهَ كَانَ بِكُمْ رَحِيماً }
“O you who believe, consume not your goods between you wrongly, unlawfully according to the Law, through usury or usurpation, except it be trading (tijāratan, also read tijāratun), so that the goods be from trade effected, through mutual agreement, through mutual good-will: such [goods] you may consume. And kill not yourselves, by committing what leads towards destruction on account of some affiliation, be it in this world or the Hereafter. Surely God is ever Merciful to you, when He forbids you such things.”
“Tafsir al-Jalalayn”

D] Qadi Abu Bakr Ibn al Arabi (d. 1148)
Allah says in the Qur’an (3:75):
“And amongst the People of the Book there are those who, if you were to entrust them with a treasure (qintar), he would return it to you. And amongst them is he who, if you were to entrust him with a dinar would not return it to you, unless you kept standing over him. “
“the benefit that can be taken from this is the prohibition of entrusting (amanah) the People of the Book with goods. The question concerning entrusting property is legislated by the text of Qur’an.”
“Ahkam al-Qur’an”

E] Imam Abu Abdallah Al-Qurtubi (d. 1273)

Allah says in the Qur’an (4:59):
“O you who believe! Obey Allah and obey the Messenger and those in command among you..”
“The ayat is an order to obey the Sultan in respect to seven obligations: the minting of the dinar and the dirham, fixing weights and measure, legal judgments, Hajj, Jumu’ah, the two Eids and Jihad.”
“Al-Jami’ li-Ahkam al-Qur’an”


Probably the biggest news story of the millenium
Courtesy of the Muamalat Council website

For most of Malaysians the morning on Tuesday, 8th June 2010, was just another morning in their existence – monotonous run on the capitalist treadmill – nothing extraordinary indeed: the same tropical weather (+32C) outside, same sickening news in the media, same interest rates, same order of the day.

But for the people of Kelantan this morning was very special: on the 8th June 2010 at 11am the box with the set of the first gold dinars and silver dirhams of the State of Kelantan arrived to Kuala Lumpur from the World Islamic Mint, Dubai. Sending the sample coins is the standard procedure in minting industry, the main lot will follow just in a matter of days.

Although Kelantan government first minted gold dinars in 2006, the new coins have a new reality because:

* This is the first time when not just gold dinar but also silver dirham has been minted;
* This is the very first time the Kelantan dinars and dirhams are minted in accordance with the international standard which is set by World Islamic Trade Organization (WITO) and monitored by World Islamic Mint (WIM); 99% of all dinars & dirhams minted worldwide in the last 20 years is the work of WIM, hence the new Kelantan coins – the reverse side of the coins bear the logo of WIM while on the obverse is coat of arms and name of Kelantan Government – have international status and acceptance among millions of muslim and non-muslim users around the world;
* This is also the first time when the coins are minted in all denominations: Dinar – ½, 1, 2, 5, 8; Dirham – 1, 2, 5, 10, 20;
* Unlike before this time the new coins will be distributed to public throughout the state of Kelantan under homogenized pricing scheme and proportionate value between denominations;
* And most significantly, this is the first time when all state companies in Kelantan will accept the Islamic coins as well as 600 shops (in the first phase) displaying the sticker “We Choose Dinar&Dirham” thus instantly giving a broad avenue for the public to utilize their coins.

And this is just the beginning, the second phase will see introduction of features like safe-keeping facilities (wadiah) and electronic payment system to further enhance the level of customers’ convenience.

click here to see the full article on the Muamalat Council website

Fair Trade – An Islamic Overview

by Hajj Asadullah Yate

Fair trading (‘adl) in the market-place is based on trust. The establishment of healthy trade is an act of worship, modelled upon the trading practice of the Messenger of Allah, may the peace and blessings of Allah be upon him.

As a principle, any exchange of goods is permitted as long as it does not involve;

1. forbidden commodities (e.g. wine, pig)
2. usury (any increase without corresponding counter-value)
3. uncertainty (e.g. sale of wheat before it is harvested, or fish before they are caught)
4. fraud (e.g. charging higher prices to travellers unaware of local prices)
5. extortion (e.g. manipulation of market conditions, monopoly, monopsomy)

Customary Practice

Fair trading is also based on a community’s understanding of the value of things, that is, their customary practice (‘urf); the local community must be left to make its own evaluation of goods. It cannot be an evaluation imposed from above or from outside.


Usury is the most pernicious destroyer of equity in the market-place and is the gateway to social imbalance and oppression and the proliferation of other malpractices. Previous generations took great pains to identify those transactions in which elements of usury had been introduced wittingly or unwittingly.

However innocuous a usurious transaction may seem, there is always an underlying element of gain for one party at the expense of loss for the other. Those engaged in such activity, Ibn Rushd states, “pay out money and receive more back without performing any deed or assuming any liability”.

Ibn Rushd insisted on the social importance of this question. “It is obvious from the sharicah that the reason for prohibiting usury is to prevent the fraud that it entails. Justice in transactions consists in close approximation and equivalence [between the goods exchang-ed]”.

Means of Exchange (Currencies)

Currencies exist in any trading situation. Ibn Rushd indicates the purpose of currency: “Since it is difficult to equate the values of things whose natures are different, dinars and dirhams are used to price them”. Here gold coins (dinars) and silver coins (dirhams) and similar non-perishable, easily quantifiable commodities with intrinsic value, not bank-notes, are referred to.

It is acceptable for those in authority to standardise currency to ensure its reliability, e.g. by issuing assayed and weighed gold and silver coins. It is against market equity for the authorities or any cartel, such as the banks, to monopolise the means of exchange. This enables the authorities, whether of bank or state, to debase the coinage (which is a hidden, and forbidden, taxation!) which is usurious because the authorities can contract debts at one value in real terms and pay them back at other values.

The creation of monopoly in the means of exchange also allows the appearance of fiat money ie. currency, based on faith, with no intrinsic worth, such as paper or electronic credits, whose value is imposed politically. This involves the fraudulent exchange of real assets for worthless tokens and facilitates the usurious manipulation of devaluation, inflation and deflation.

The Sale of Commodities

In order to prevent usury, you can only exchange commodities sold by weight and measure i.e. staple foodstuffs, gold and silver, for the same type of commodity e.g. minted gold for unminted gold or good dates for poor dates, when you exchange equal weight for equal weight, measure for measure, with no deferral of payment. Ibn Rushd explains it thus: “Given that there are no radical differences between specimens of the same type, when their uses are approximately the same, and that the person in possession of one type has no pressing need to exchange it for another of the same type, except by way of extravagance, equity is obtainable only on the basis of equivalence in terms of weight and measure”. In other words it is permitted, albeit regarded as an ‘extravagance’, to exchange patna rice for basmati, but only as long as the weight of the patna equals that of the basmati.

Forbidden Sales in Commodities

Ibn Rushd lists eight examples of sales, each of which demonstrates how usury enters into sales of commodities.

1. “Give me respite [from repayment of a debt or payment for goods bought on credit] and I will increase [the amount to be paid]”. (In other words the borrower or purchaser, addressing the lender or seller, says “Give me more time to pay the debt and I will pay you back more”).
2. A sale with forbidden disparity. (This refers to staple, storable foodstuffs, gold and silver which cannot be exchanged ‘with each other’ with disparity: thus an exchange of 1 gold coin for 10 silver coins is permitted but an exchange of two pounds of poor quality dates for one pound of good quality dates is not. If good quality dates are required, the poor quality dates must be sold and good quality dates bought with the proceeds).
3. A sale with forbidden delayed payment. (This refers to gold in exchange for silver, dates in exchange for raisins, or wheat etc., etc., which although of different types cannot be exchanged with each other when payment of one of the two is not immediate).
4. A sale combined with a loan. (All contracts which are composed of more than one transaction are forbidden).
5. A sale of gold and merchandise for gold. (This is because, in effect, gold is being sold for gold with disparity Ð the merchandise only obscuring the transaction).
6. The sale known as ‘reduce the amount in return for immediate settlement’. (This is a kind of usury in which the borrower who has agreed to pay back money by a certain date offers to pay a smaller amount before this date Ð now known as discounting of bills or factoring of debts).
7. The sale of foodstuff which has not yet been received in full [by the seller]. (Actual possession must be taken of all foodstuffs before their resale).
8. A sale combined with a money change. (Again, this is a trans-action in which the equivalence demanded of any money change is obscured by the accompanying sale and is also two transactions in one contract).

Ibn Rushd cites “the protection of wealth and prevention of squandering” as Malik’s explanation for the prohibition of usury. He also mentions Ibn al-Majishun’s explanation as “preservation of property (hiyata al-amwal) meaning that fraud should be prevented”.

The term “usury” has a much wider definition than that of [modern] English law: usury, in effect, can occur in almost any transaction: thus pure sales, barter transactions, money exchanges, speculation, the leasing of land for a share of its produce, control through monopoly etc. are all subject to the prohibition of usury if unjustified increase occurs to one party.

The Elimination of Parasitical Third Parties

What is significant for us is that parasitical third parties, state interference, commercial taxes and devious practices have no place in the Muslim trading world: there can be no money lenders, no bankers, no speculators, no stock exchanges, no promissory notes, no bonds, no lotteries. Traders must be free to operate within a basically healthy arena in which the pillars of sound trade are in place, namely free access to gold and silver as currency and the right to choose any means of exchange, unfettered by the tyranny of paper, plastic or computerised money, free of the monopoly of the banking system which governs all financial and political transactions today.

In the concluding remarks to the Bidaya al-Mujtahid Ibn Rushd points out that the underlying rationale of all transactions regulated by the law is the establishment and maintenance of human virtues, in this case that of justice. The way of the Muslims, the shari’ah, is composed of various behavioural patterns or sunnas. The prohibition of usury, risk and speculation are among the sunnas which “relate to the pursuit of justice and the avoidance of oppression: these are the kinds of sunna which demand equity in financial matters (al-‘adl fi’l-amwal) and justice amongst people.”


Traders move goods from a place, where these goods are in abundance, to another where there is a market for them. The trader expends energy in his going out to find suitable goods, in securing a reasonable price for them, in transporting and guarding them safely, and finally in selling them to a second party. The usurers however rent out money, which by its nature is only tolerated by natural communities as a means of exchange, and merely wait for its return with increase. They produce nothing, do not contribute any work and do not incur any risk. They are parasitical third parties who borrow from one source at one rate and lend to another at a higher rate thus preventing direct contact between investors and entrepreneurs. The most sophisticated form of usury is the establishment of ‘national banks’ which gather up a country’s gold and silver, prohibit its use by the people, print paper money – of which they have the monopoly Ð in its stead and then raise or decrease its ‘value’ (by devaluation, inflation or exchange-rate adjustments) to create speculation and the opportunity for vast profit.

Trade is generated from the face to face meeting of men who do not negotiate with any third party, be it in the guise of state tax regulations, customs tariffs, bankers, brokers, insurers or specialists in ‘international’ law. A trader’s handshake or his word is enough to seal a contract.


A contract is an act of trust between two people. Its reality extends beyond the material exchange of two commodities. A trader knows that his reputation for honest dealing is the key to swift and uncomplicated exchanges. Written contracts are drawn up whenever the exchange of goods or payment is delayed and the two parties see this to be of mutual benefit Ð when agreed delivery dates and precise measurements of commodities to be supplied in the future, for example, might otherwise be forgotten. Likewise witnesses may be signatories to a contract if their presence facilitates trust between the two parties.

In general, a contract Ð that is an offer and an acceptance and the obligation [to supply or pay for something] Ð is binding upon the parties when the buyer accepts the seller’s offer, before the two parties separate. When the buyer takes possession of the goods he usually accepts liability for them. There is, however, a warranty period, during which the buyer may return the goods to the seller and recover his payment if he discovers a defect in the goods. This is as long as the two parties have not agreed upon a waiver of this warranty (bara’a) during their meeting. The seller may not normally impose any condition on the buyer restricting the latter’s ownership of the goods.


The Prophet, may the peace and blessings of Allah be upon him, sanctioned qirad investments which exclude any usurious third party: by it the investor (rabb al-mal) makes over a certain sum of money (in gold or silver) to an ‘agent’ (al-‘amil). The agent uses these funds to trade and pays back the capital plus a previously-agreed percentage of the profits to the investor when the goods bought with the funds have been sold. The increased return on the initial investment is equitable as it is a loan which incurs risk for both parties: if the agent makes a loss (on the investment and on his time and work) the investor will also make a loss.


Partnership likewise excludes usurers. By it, two or more parties come together and contribute equal shares of money, goods, equipment and work (shirka al-amwal), and then divide the profit between themselves equally. If the contribution from one partner (of either money, goods, equipment or work) is greater than the other partner, equity must be established by a division of the profits which is in proportion to this disparity. Equity may also be established in a partnership by one partner contributing all the equipment, for example, and the other contributing all the goods, as long as the rental value of the equipment and the profit-potential of the goods is approximately the same. Partnerships based solely on persons’ work (shirka al-abdan, i.e. when two cobblers come together and ‘share’ the same customers) must be located under one roof. Each partner is liable for delivery of orders taken by the other. When partnerships are based on money, each partner is free to buy and sell with the ‘pooled’ money of the partnership (that is a mufawada part-nership of mutual delegation); when trading out of their localities, partnership funds may be used for travel expenses and maintenance of each partner’s family. It is, however, permitted to restrict the use of the ‘pooled’ resources by a mutual agreement to only buy and sell with both partners’ knowledge.

Shirka fi’l-bai’

A shirka fi’l-bai’ contract is one in which one party says to the other: ‘Make me an equal partner in this article belonging to you on condition that I sell it for you’. In effect what happens in this transaction is that the article is transferred to the first party without payment of money. It is equitable, however as the first party has become a partner in the article and pays for it by undertaking to sell it (in this respect it is not dissimilar to a contract of hire whereby the owner ‘hires’ the services of another party and pays for this hire by making him a partner in the goods). When he does sell it, he pays back half of the original value of the article to the second party together with half of the profit realised by their partnership. The ‘owner’ of the goods may fix a minimum price or the expected profit margin for the article which the other will sell.


A murabaha sale is one in which a trader goes to another city and states prior to a deal that he is selling a commodity for such and such an amount above his cost price. This transaction is permitted as it is essentially the same as buying and selling: it is equitable as both partners are legitimate traders who both agree on the nature and quality of the subject matter of sale and their profit margin prior to any dealing. It is based on the first party’s trust that the other partner will always only add on, for example, 10% profit for himself on top of the price of the goods and his expenses incurred in procuring and delivering them.


In any sale/exchange, payment and the taking delivery of the goods is normally simultaneous. A salam contract is a form of sale on delayed terms in which the money (or anything used in payment) may be paid first and the goods delivered at a later date. This is to permit the making of a contract for goods which are in another country or only available, for example, on the market day of the following month. The precise date of delivery must be stipulated. The commodities exchanged must be different to each other in kind or in use, and must not involve the exchange of food for food or gold for silver. The salam contract does not stipulate that a specific object will be delivered at such and such a date but rather stipulates the type of object, like a horse or a sword. A nasi’a contract is similar except the money is paid later. It is not permitted, however, that both payment and delivery of the thing paid for are delayed. In any sale, be the payment or delivery of goods immediate or delayed, transfer of ownership is effected at the time of the deal (i.e. immediately the offer of the first partner is accepted by the first).


A rental contract (kira’, ijara) is one in which one party, the leaseholder (al-mustajir), pays for the temporary use of a house, beast, or piece of equipment. The contract must stipulate the hire-charge, the period of hire and the location in which the thing hired is to be used. The owner (al-malik) of the rented article is liable for any damage to the article. Similar to this are contracts of hire regarding persons engaged to work for a daily, weekly or monthly wage (ijara) or to complete a specific job for a specific reward in a time which is not specified (jucal). Although it is permitted to ‘hire’ someone to buy you something it is not permitted for you to ask him to use his own money on the understanding that you will pay him back later.


The Amir sets aside areas as markets in which the people may come to sell their goods. The stalls or shops are ideally of a non-permanent nature, erected merely for the protection of the traders and the goods from the weather. They are there so that those who want goods from artisans, farmers and agents may buy them from them. People set them up at times of harvest, on the arrival of caravans and for a variety of other seasonal and social reasons. They are not a prelude to the establishment of fixed, structured shops, grocers, engrossers, wholesalers or ‘supermarkets’. These latter only hoard and monopolise commodities in order to control and manipulate prices. Markets, when they reach this stage of ‘development’, become a barrier to free exchange for those who wish to buy and sell at a modest level. All such practices (known as engrossing and regrating in English law) were outlawed by edict until the introduction of foreign ‘Banking’ law (i.e. the law of the moneylenders and hoarders) at the beginning of the 18th century.


A caravan is a group of traders, qirad agents, partners or artisans who travel together to establish new markets or take part in existing markets outside their home countries in order to buy and sell. Their travelling together affords the protection of a company of men, and protection from the dangers of the open road. They should not have to pay any taxes in the establishment of these markets. They only require the permission of the local Amir. It is not permitted for people to go out to meet the caravan before it has arrived in a town in order to buy goods wholesale and at a lower price than the goods would otherwise have fetched on the open market (forestalling).


We must recognise the obligation of paying zakat-tax on wealth to the Amir as well as and at the same time as establishing free markets. Payment of the zakat purifies and increases the wealth generated from trading, confirms traders allegiance to their Amir and ensures the distribution of surplus wealth to the poor, the needy, those fighting in the way of Allah and for justice, and other categories of persons.

Commenting on Allah’s words: “That which is given [as zakat-tax] is for the poor, the needy, those who work for this [zakat], for those whose hearts might come closer [to Allah], for slaves, for debtors, and in the way of Allah and for the traveller: [this is] an obligation from Allah, and Allah is the Knower, the Wise.” (Sura at-Tawba, ayat 60), Ibn Juzayy in his Qawanin says: “As for ‘those who work for this [zakat]’, they are the persons who collect, distribute and record it, even if they have independent means. This depends upon their being just and knowledgeable of zakat-law.

As for ‘those whose hearts might come close [to Allah]’, they are the kuffar, to whom it is given in order to encourage them to Islam.

Its distribution is according to the estimation of the Amir. It is permitted to give it to only one of the eight categories of persons mentioned in the Qur’an, or to give preference to one category over another. Moreover anyone who qualifies for two of the categories has a right to two shares.

It is not to be transferred from the region in which it was collected, except when there is an excess.

The zakat is not to be spent on building mosques, nor on burying the dead.

It is obligatory to pay the zakat to the Amir if he is just.”

See glossary of terms