2. CONTENT
DEFINITION
DEFINITION
EVIDENCES
EVIDENCES PILLARS OF BAY AL-DAYN
TYPES OF BAY’ AL-DAYN
PILLARS
CONDITIONS OF BAY AL-DAYN
TYPES
OPINION OF SCHOLARS
MODERN APPLICATION
OPINION OF
SCHOLARS
APPLICATION
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3. DEFINITION
Literal:
DEFINITION
Debt, pecuniary obligation, liability or obligation
EVIDENCES Technical:
An exchange between A payable right upon the person
PILLARS and A property on the basis of ownership of the price
and the right
TYPES Sale of debt which can be either against a debt or
other than a debt , to the debtor or other than a
OPINION OF
SCHOLARS debtor, on a cash basis or a deferred payment basis.
Sale contract in which the creditor sells his payable
APPLICATION
right upon the debtor either to the debtor himself or
to A third party at discount price or at cost price on
the spot payment basis
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4. EVIDENCES
Hadith:
DEFINITION
Ibn Umar reported that: One day he came to see the
Prophet (saw) and told him: I sell camel in Baqi’ in
EVIDENCES
dinars (debt) and accept dirhams (payment), and I sell
in dirhams (debt) and accept dinars (payment). The
PILLARS Prophet (saw) said: It is okay, but you should try to
accept it at the day price for each before you conclude
TYPES your contract.
Narrated by Muslim
OPINION OF
SCHOLARS
APPLICATION
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5. EVIDENCES
Ijma’
DEFINITION
Majority of scholars agree on its permissibility because
there is no single nas quoted its prohibition except the
EVIDENCES
prohibition of bay’ al-kali’ bi al-kali’.
They hold different views about sale of debt to the third
PILLARS
parties on the ground that the seller will not be able to
deliver the sold debt.
TYPES
Legality of bay’ al-dayn depends on its types which
OPINION OF are determined by the number of parties involved
SCHOLARS
(whether two or three), the party to whom the debt
APPLICATION is sold (whether to the debtor or non debtor) and the
modes of delivery (on a spot basis or credit basis)
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6. PILLARS OF BAY’ AL-SARF
Seller and buyer
DEFINITION
Merchandise/goods
EVIDENCES Price
Sighah
PILLARS
TYPES
OPINION OF
SCHOLARS
APPLICATION
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7. TYPES OF AL-DAYN
DEFINITION
Confirmed Debt (Dayn Mustaqir)
• A debt which is fully confirmed upon the debtor and he has to pay it.
EVIDENCES
• It cannot be either cancelled or waived without the consent of the
creditor
PILLARS • Eg. Credit, cost of damages, price of a good, cost of completed labor,
and dowry of spouse after marital consummation
TYPES Non confirmed Debt (Dayn Ghayr Mustaqir)
• A debt in which has not fully confirmed upon the debtor due the fact
OPINION OF that the possession of the creditor is subject to its confirmation.
SCHOLARS
• It can be cancelled at any time before the completion of the basic of the
debt.
APPLICATION
• Non-confirmed debt is used for selling or buying to a third party.
• Eg. Cost of labor before the completion of the work, dowry of spouse
may not complete in case of the divorce before marital consummation.
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8. CONDITIONS OF BAY’ AL-DAYN
No delivery risk
DEFINITION
The debt is confirmed and owned
EVIDENCES No element of riba and gharar
PILLARS
TYPES
OPINION OF
SCHOLARS
APPLICATION
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9. OPINION OF SCHOLARS
DEFINITION
Sales of Debt to the Debtor
(Bay’ al-dayn li al-madin)
EVIDENCES
• According to Hanafis, Malikis, Shafiis and some Hanbalis, the
sale is allowed and fully permissible
PILLARS • The creditor has the full right to sell his debt to the debtor as the
debt raised from the cost of damage, qard, price of commodity
TYPES and cost of services
• Regardless of the types of the debt (confirmation or time
OPINION OF stipulation) and at any time and any price
SCHOLARS • Selling the debt to the debtor means the debtor is taking what he
is supposed to take in reality
APPLICATION
• The debt is a right. Therefore selling or giving it to the debtor is
originally allowed
• The delivery of the item to the buyer is not needed in sale of
debt, therefore it is permissible
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10. OPINION OF SCHOLARS
DEFINITION The Sale of Debt to a Third Party
(Bay al-dayn li ghayr al madin)
EVIDENCES
• According to Hanafis, some Shafiis, Hanbalis and Zahiris – the sale of
confirmed or non confirmed debt is not allowed to be sold to the third
PILLARS party based on:
• A sale of un possessed item (bay’ ma la tamlik)
TYPES • A sale of undeliverable item
• It may create a conflict between the debtor and the buyer of the debt
OPINION OF • Some Shafiis and Hanbalis (Ibn Qayyim) – the sale of confirmed debt to
SCHOLARS the third party is allowed based on:
• There is no authentic nas that prohibits such sale
APPLICATION • The debt is a right in the possession of the creditor. So he has the full
right to sell it to the debtor or the third party
• Based on legal maxim: All transactions are permissible until they are
proven non permissible by an authentic source
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11. OPINION OF SCHOLARS
DEFINITION The Sale of Debt to a Third Party
(Bay al-dayn li ghayr al madin)
EVIDENCES
• According to Majma’ Fiqh al Islami
PILLARS
• Sale of debt to the debtor is permissible
• Sale of debt to the 3rd party is permissible
TYPES
• Provided that there is no element of riba and gharar
• Shariah Advisory Council of Securities Commission of
OPINION OF Malaysia
SCHOLARS
• Bay’ al dayn is permissible
• Bay’ al-kali’ bi al-kali’ is not permissible
APPLICATION
• Sale of debt to the debtor is permissible
• Sale of debt to the 3rd party is permissible
• Provided that there is no element of riba and gharar
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12. APPLICATION
Bay’ al-dayn has been mainly used in Malaysia as
DEFINITION
one of the underlying Shariah contracts in
structuring various Islamic finance facilities
EVIDENCES
including:
PILLARS
Islamic money markets instruments
Islamic treasury bills
TYPES Islamic negotiable instruments
Islamic accepted bills
OPINION OF
SCHOLARS Islamic bonds
APPLICATION
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13. END OF CHAPTER
DEFINITION
EVIDENCES
PILLARS
TYPES
OPINION OF
SCHOLARS
APPLICATION
13
