Modern application of Bain al-Sarf (Currency Exchange) from Maqasid al-Shari’ah perspective: A scoping review

Abstract

Bai‖ al-sarf widely known as currency exchange is an important sale contract both in classical and contemporary world. This scoping review looks into the objectives behind the rulings set by the Shari‖ah for this sale contract. These objectives are sorted out from the commentaries of the hadith and the deliberations of the jurists through tex-tual analysis method. Some of the modern applications such as T+2 and Islamic Foreign Currency Exchange (FX) Swap structures are briefly juxtaposed against the objectives of bai‖ al-sarf we discovered. Objectives of Shari‖ah rulings in spot exchange is to avoid falling into the sale of debt against debt (al-kali bi al-kali), prevention of payment delay by one of the counter parties, prevention of conflict between the counter parties, and last not least to avoid falling into exchange contracts that will induce riba.