Zakat with banknotes and small change

Question

Question: Zayd has banknotes worth one thousand rupees and wants to pay zakat on them. The former rupee, in which silver predominated, is not to be had for paying zakat. Any one of the following four ways may be adopted. (1) Zakat is paid with the banknotes themselves. Will zakat be paid in this case or not? If it will, will it be paid unconditionally, as with the former rupee, or with some condition? (Note)

Answer

(1) A banknote is not a rupee but a document (sanad) for a rupee. Therefore zakat will be paid by means of a banknote on condition that, once it reaches the recipient of zakat (masraf), the recipient spends it on his own needs. If the banknote is lost before that and the recipient could not put it to use, the zakat will not be paid.

Source: Fatawa Mahmudiyya

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