State Use of Precious Gems as Currency
প্রশ্ন · Question
We have mentioned in most of our publications and books that the
currency will be of gold and silver, either in actual form or in the form
of notes backed by gold and silver. In the book ‘Funds in the Khilafah
"Caliphate" State' by Shaikh Abdul Qadeem Zalloum (May Allah have
His mercy on him) on this subject, it is mentioned that the state can
use either gold or silver or any other appropriate metal so long as gold
remains the main currency. Therefore can the state use other
expensive metals side by side go ld and silver like platinum or gems like
diamond and others?
উত্তর · Answer
In Islam, the currency is gold and silver per se or other means like
paper notes provided that the Bait ul Maal has an equal quantity of
gold and silver reserved against it.
It is possible to use cheaper metals like copper as has been mentioned
in the book ‘Funds in the Khilafah "Caliphate" State' since for the
purpose of cheaper things, the gold and silver coin units will have to be
of such minute quantity or weight that it will be impracticable for
normal use in transactions. For this reason coins of appropriate weight
made of minute quantities of gold and silver mixed with a larger
proportion of a cheaper metal will be practicable in transactions
involving very cheap commodities.
It is mentioned in the book ‘Funds in the Khilafah "Caliphate" State':
(...The state can also coin units smaller than that of silver to help
obtaining trivial things. Since the silver contained in these silver units is
little and it is difficult to deal with them as they are pure coins specific
portions of different valueless metals can be added to them. However
the portion of silver in weight used in these coined units must be
clarified in a manner preventing any confusion over it.
The Muslims thereby proceeded on the gold and silver standard i.e.
the bimetallic principle. In the last days of the Abbassids and the
period of Attabka in Egypt, Muslims coined besides the gold and silver,
copper currency to buy trivial things because copper's intrinsic value is
low. It was not representative of gold and silver; rather it stood on its
own depending upon its value as copper. Thus it was used to buy
cheaper commodities...)
And thus metal other than gold and silver used for coins will generally
be cheaper metals but these will not be used for purchase of precious
metals like gold and silver because the issue here is purchase of
cheaper commodities that require an appropriate and practical
amount for transaction. If such coins used for purchase of cheaper
commodities are made of gold and silver, then will have to be of a very
minute quantity and weight. Therefore a cheaper metal would be used
so that it is of a reasonable weigh t which is practicable for use in
transactions which cannot be achieved by using precious metals.
As for the permissibility of Shari'ah currency using more precious
metals like platinum or precious gems like diamond...then it is not
permitted because the Shari'ah evidences on gold and silver being the
currency and clear and known. Similarly, it is not permitted to have
other metals even more expensive than gold and silver as reserves in
the Bait ul Maal in accordance with the Shari'ah. And other metals is
nothing more than a commodity.
19 Shawwal 1431 AH
28/09/2010 CE