Salam sale

Question

Question: Alif is a farmer, and Be is a moneylender. In the rains the farmer sows all kinds of seed in his field. When the plants ripen, money is needed for the further work — harvesting, threshing (?) and so on. The farmer has no money left, so he goes to the moneylender and asks for money. The moneylender is willing to give money, but on the condition: “I will give at this rate: cotton at 40 or 45 rupees a maund (a maund of 40 kilograms)

Answer

This transaction has become a salam sale. If the kind, weight, rate, place and time of delivery of each commodity are fixed in such a way that no disagreement or dispute arises, it is valid. The rupees taken in advance are the price of that commodity, not a loan.

Source: Fatawa Mahmudiyya

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