RESOLUTION No. 66/4/7
ON BAY' AL-WAFA (DEBT GUARANTEE SALE)

Compiled By:
Prof. Dr. Mohd. Ma’sum Billah
masum2001@yahoo.com
masum@applied-islamicfinance.com
+6019-3699542

 
Quote - The Council of the Islamic Fiqh Academy, meeting in its seventh session held in Jeddah, Kingdom of Saudi Arabia, from 7-12 Dhul Qi'dah 1412H corresponding to 9-14 May-1992.

Having considered the research papers received by the Academy on the subject, ''Bay al-wafa''
(Debt guarantee Sale)

Having listened  to the discussions held about ''bay al-wafa'' and its real nature i.e ''the sale of money on condition that when the seller returns the price, the purchaser returns to him the amount purchased''
                                                               

RESOLVES

First :That this sale is in fact ''loan which has generated a profit'' It is therefore a fraudulent practice of Riba,and is considered unsound by the majority of Ulema.

Second :The Academy considering this contact prohibited in Shari'a.

(Source: "Resolution and Recommendations of the Council of the Islamic Fiqh Academy (1985-2000)” , IRTI.)