The condition of paying loan with equivalent value of gold in future

If Mr X is asking for a loan of Rs 30000 from me & I am putting the condition that I am giving you this money which is equivalent to 10 Grams of Gold price & whenever you will return this money to me the amount should be roughly equivalent to 10 Grams of gold. Is this type of lending allowed in Islam?

This type of condition in lending money is not allowed in Islam because it is in principle the repayment of a loan should be similar to the loan.  In the mentioned case, since you loan 'Mr X' Rs 30000 rupees, 'Mr X' has to repay you the same amount in rupees. It is not correct that the money be paid or taken back in equivalent up and down value of 10 Grams of gold at the time of paying. If you would give him 10 grams of Gold than you are eligible to receive exact 10 grams of gold of same quality not a gram less or more or it will tend to be Riba (interest).


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