The concept of money has been a major topic of discussion in all religions, and Islam is no exception. In Islam, the concept of money is closely linked to concepts such as justice, charity, and responsibility. Money itself does not have any intrinsic value; instead, it serves as an instrument for exchanging goods or services between people. It can also be used to store wealth for future use or investment purposes.
In Islamic teachings there are certain principles that must be followed when dealing with finances;
1. Earning Money in Islam
Muslims should only earn their income through lawful means such as trade and business activities which do not involve gambling or usury (charging interest). They should also strive to make sure that they are contributing positively towards society by providing useful products/services rather than exploiting others financially through unfair practices like price gouging etc.
2. Spending Money in Islam
Muslims must spend their money responsibly on necessities first before indulging in luxuries; this includes taking care of family members who may need financial assistance from time-to-time too!
Additionally they should give away some portion (usually 2.5%)of their earnings in charity every year – known as Zakat – which helps those less fortunate than them receive basic necessities like food & clothing etc.
Lastly they must avoid wasteful spending at all costs since this goes against the Islamic principle of being mindful about one’s resources so that everyone gets what’s due to them according to Allah’s will & plan!
By following these guidelines strictly it ensures both spiritual satisfaction along with material prosperity for individuals within Muslim communities around the world today – something we could all learn from regardless religion affiliation we may have.
So lets dive into the detailed concepts of Money as been preached by the religion Islam;
3. The Story of Exchange of Dates
Bilal (Radi ALLAHu Ta’ala Anhu) once came to the Holy Prophet SAW and offered him some dates. The Prophet looked at the dates, he said, ‘Bilal these are very high quality dates. Where did you get them?’
Bilal (Radi ALLAHu Ta’ala Anhu) said to the Messenger of Allah that ‘I had two kilograms of inferior quality dates. Maybe the two kilograms dates were worth $25 each, $50. And I exchanged them for this one kilogram of superior qualities dates, which probably was worth $50. So, in value they were equal. I exchanged these two kilograms for this one kilogram’.
‘Bilal’, said the Prophet SAW, ‘Bilal this is the essence of RIBA, Bilal what you should have done was to sell the two kilograms and use that money to buy the one kilogram’.
4. What is the Riba?
But a direct exchange of dates for dates which was an unequal exchange was Haram was RIBA. Why?
Why a hundred years ago even a schoolboy could answer that question. Today not even Darul Uloom Zakaria in Johannesburg could answer that question. It’s how even Darul Uloom New Castle cannot answer that question. Why?
To find out why? An unequal exchange of dates was Haram and Riba. But an unequal exchange of camels was not.
That Ali RA exchanged one camel for four or one camel for twenty, but Umer (Radi ALLAHu Ta’ala Anhu) exchanged one camel for four, but that was not Haram, nor it was RIBA. But the unequal exchange of dates was RIBA. And why was it Riba.
5. What is Money in the Quran and Sunnah?
In answering that question, we are introduced to the subject of what is money in Islam? What is money in the Quran? What is money in the Sunnah?
I delivered this lecture in Durham-Newcastle, South Africa, and the venerable Molana Sema, may Allah have mercy on his soul, died recently at the age of 80. The old man was sitting there for two hours for the lecture and at the end of the lecture he said to me ‘we have to teach this subject in the Darul Uloom’, meaning it’s not taught.
6. The Definition of Money in Islam
The Prophet says SAW, he gave a command, ‘when a transaction is such that it involves an exchange of gold for gold, or silver for silver, a wheat for wheat, for barley for barley, for dates for dates, for salt for salt, all six of them (gold, silver, wheat, barley, dates, salt). It must be equal for equal. You cannot have an unequal exchange, otherwise it will be Riba.
Before we ask the question, why would it be Riba?
Let us look at these six, what is common to all six. This is a hadith, incidentally, with which the world of Islam is very familiar, gold for gold, silver for silver.
What is common to all six?
They were all used as money. That when gold or silver coins were in scarce supply in the market in Medina, they would use dates as money.
And so, from this hadith we get a definition of money in the Sunnah.
That money was either precious metals, gold and silver, or commodities of food consumption that were having an abundant supply in the market and which had a shelf life. So, you would use mangoes as money. Because your money will be rotting.
7. The Money with Intrinsic Value
What was common to all of these six is that the value of the money was inside the money. The money had intrinsic value. What was common to all six, is it the value of the money, despite fluctuations based on the demand and supply. The value was always value created by Allah.
And so, we get the definition of money in the Sunnah. Because dates were used as money, if we allowed an unequal exchange of dates, then I can lend money on interests. I just give you one kilogram and you will return to me two kilograms after one year. So you will open the door for the money lender. If you allow an unequal exchange of money, the same money being used on both sides.
But you could not use animals as money, because you know the one, I got a goat as my salary and I was taking the goat home, the goat fell down and died. So when I reached home, I told to my wife, that the salary died. She said, go to the boss, so I went to the boss, and I said the boss that my salary died. He said, but when I gave you salary, the salary was alive.
Since animals can fall ill, since animals can die, animals could not be used as money. And therefore, you could have an unequal exchange of camels.
Now then, this is money in the Sunnah, money with intrinsic value, money which is either precious metals or commodities of food consumption in abundance supply in the market. And which had a shelf life.
Money with value despite fluctuations based on demand and supply with value created by Allah. Only He can create wealth out of nothing. He creates out of nothing. He creates from point of origin. He creates and he fashions, but He is also who creates from nothing.
8. Concept of Money from Quran
Is this money also in the Quran? Yes, it is in Surat-Tooba, Allah Subhanahu Wa’ta’ala takes two tasks the Israelite people, and amongst them and if you entrust him with a treasure about 1,200 ounces of gold, enough to buy a house in San Francisco. When you want it back, he returned it to you. And amongst them there are those who if you entrust him with one dinar, when you want it back he won’t give it back to you. The only way you can get it back is if you stand there and pounding for it. This is because of the double standards.
We have one code of morality amongst ourselves and we do not have to apply that code of morality with these cockroaches. But they tell a lie against Allah. They do it knowingly, they have changed the word of Allah.
I couldn’t preach this in New York today. I could have done it five years ago sorry ten years ago. But today I cannot deliver this lecture in New York. They changed the world of Allah.
But in this Ayah the word Dinar is present, and the word Dinar in the Quran refers to a gold coin. No one challenges them, and then in Surah-Yusuf they took him out of the well, and they took him to Misar.
And when the Quran says Misar, it is not referring to the whole of Egypt. Misar at that time was only the east and Delta between the Nile and the Red Sea where Bani Israel had settled. And that’s the Misar. And they sold him in Misar for a few measly Dirhams and Dirham in the Quran is a Silver coin.
So in the Quran we have money, and money in the Quran is a precious metals. And money in the Sunnah is precious metals as well. And when there is a shortage of gold and silver then you can use commodities.
If you are in the Indonesian Island of Java. If you are in Java and you run short of Sunnah money that is the gold and the silver coins. What would you use as money? Rice of course. Even though rice is not in this list. It is it is a commodity of food consumption. It is an abundant supply in the market and also has a shelf life.
And if you are in Cuba and you want to bring back Sunnah money, you don’t have gold and silver, what would you use as money? You would use sugar. It is so simple.
Now then so long as we use this money, the money that Allah and His Messenger has ordained that we use. This money functioned successfully as money.
9. What are the Functions of Money?
There are several functions of money that are given below in details;
1. Medium of Exchange for Buying and Selling
Money functions as a medium of exchange for buying and selling. Notice I am teaching this subject so simply, there is nothing complicated here and so when you go back home and you have to teach this subject, please teach it simply. And do not make it complicated.
If you have to look at the functions of money, you would find that money functions as a medium of exchange for buying and selling.
I need a haircut, so I went to the barber and he cut my hair and when he has finished cutting my hair, I offered him my book. He looked at me and said I’m not interested in your book. And the Lord who is all-wise would know that and so I mean something called money, that I can pay the barber for cutting my hair. And then he can use that money to go and buy a kilogram of tomatoes.
And so, the first function of money is to be a medium of exchange. Gold and silver, wheat and barley, functions successfully except that when you’re using commodities as money it’ll only be micro transactions not macro. You can’t buy a house with wheat between microtransactions temporarily.
2. Measure of the Value
The second function of money is to be a measure of value. What is the value of a haircut and what is the value of the book. So long as mankind use the real money it always functioned successfully as a measure of value.
And so, the black African woman in her own country incidentally, in her own Africa. Who had to work as a domestic servant. Sometimes not one because six of them in her home. When she works, the black African woman, I know her because everywhere I went, I used to meet her.
When she worked for a whole month, she would get a wage that was a just wage, on the basis of the measure of the value of her labor.
And so, our money function successfully. Not only as a medium of exchange, but also as a measure of value.
3. Store of the Value
But money has a third function to perform, and that is to be a store of value. In Surat al-Kahf, when that man dug a hole and buried his money in the hole and then he built a wall and he prayed. Because maybe he was terminally ill and he had little children. His orphan children when they grow up and become adults that they would be able to get the money he left behind for them.
If he left behind a hundred gold coins and the hundred gold coins could buy a hundred camels. Then he would want that his money after 20 years with have stored its value and preserved its value. So the twenty years later when his children got that money from the hole, that money could still buy a hundred camels provided demand and supply being constant.
Our money, the money in the Quran, the money in the Sunnah, perform that function successfully of being a store of value. And this is how the world is trading.
If you wanted to rip-off someone, what you’d have to do is to mix some kind of alloy with the gold or chip the gold, used to appoint market police and the market police will be moving around in the market and if anyone was caught with money which was not the correct weight or purity. Right there in the market you would be tried, right there in the market you will be sentenced, right there in the market you’d be punished.
The State University of New York in a place called Binghamton, is famous for scholars who have distinguished themselves in the study of the free and the fair market. And they have come to the conclusion that the last free and fair market that the world ever experienced was the market of the Ottoman Islamic Empire.
When they strange and mysterious Alliance took place between European Jews and European Christians, that strange and mysterious alliance created modern Western Civilization the Modern West. And the modern West then proceeded to attack money, to corrupt money, to destroy real money, and to substitute it and replace it with artificial money, the bogus fraudulent money, that was totally and utterly Haram.
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