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Selling rare coins & notes of currency at more than their face value

Published: 24/08/2011 10:54:00 AM GMT
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Is it lawful in Islam to sell a currency note or coin for more than its face value if it is rare and collectible? Or would that be a form of interest? Does it make a difference if the bill or coin is in a denomination that is no longer recognized as money?

Answered by

Sheikh Muhammad Muhammad Sâlim `Abd al-Wadûd

You may sell rare coins and bills of currency for more than their face value.

It is unlawful to exchange gold, silver, and currency except hand to hand, and if the metal or currency is the same, in equal amounts.

The Prophet (peace be upon him) said: “Gold for gold, silver for silver, like for like, hand to hand, and whoever increases or ask for increasing he falls in usury.” [Sahîh Muslim]

Money takes the ruling of gold and silver in that it fulfills the exact same function in society. Money acts as a medium of exchange and as a store of value.

However, rare notes and coins have – according to the customs (`urf) of the market wherein they are sought – have ceased being traded as a medium of exchange and have become objects of value in their own right.

Therefore, it is permissible to purchase these objects with currency. This is the case even if the rare coin or bill is of a type that is still recognized by statute as being legal tender. One can purchase a rare coin or bill with modern currency of nominally the same type.

This means a person may purchase – for instance – a rare 19th century dollar note with current dollars, even if that 19th century note is still permitted as legal tender by statute. This is due to the fact that the actual role the note plays in the market has changed drastically. Now it is regarded in the market as being no different than a rare document or a rare print.

In the sale of a rare and collectible note or coin, the item being sold is not treated as currency, nor does it function in any practical capacity as currency. It functions as an object of value like any other antique.

And Allah knows best.

Source: Islam Today




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