Exchanging Duit Raya: When It Becomes Riba & How to Avoid It
•By Muslim Economist
Artikel ini juga tersedia dalam Bahasa Melayu
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As Hari Raya Aidilfitri approaches, a phenomenon increasingly viral on social media is what netizens call the "duit raya cartel". Many people offer services to exchange old notes for crisp new ones - RM1, RM5, RM10 - charging a fee. Some charge RM3 per RM100, others RM10 for RM500.
But the question is: is this riba (usury)? Is it the same as paying someone to go exchange money at the bank? And where is the line between halal and haram in this duit raya exchange?
This article answers all these questions based on scholars' views and official fatwas in Malaysia.
Exchanging duit raya at equal value (e.g., RM100 old = RM100 new) in cash is permissible (harus). It becomes haram and riba when the values are unequal - for example, giving RM100 but only receiving RM95 in small notes because RM5 is deducted as a "fee". If you want to pay someone to exchange money at the bank, the fee must be paid separately from the exchanged amount - not deducted from the exchange value.
The term "duit raya cartel" refers to individuals or groups who monopolise the supply of new notes before Raya. They queue early at banks, exchange large amounts of money, then resell to the public at a markup.
Common examples:
This practice differs from a situation where someone is asked to help exchange money at the bank. This distinction is crucial from an Islamic law perspective.
In fiqh muamalat (Islamic commercial law), paper money is categorised as a ribawi item because it functions as a medium of exchange. This is based on the decision of Majma' al-Fiqh al-Islami (OIC) which stipulates that fiat money is subject to the rules of al-Sarf (currency exchange).
When exchanging money of the same type (e.g., Ringgit for Ringgit), two mandatory conditions must be met. Otherwise, the transaction falls into the category of riba.
The Federal Territory Mufti Office also confirms that fiat money is ribawi property and any same-type exchange must comply with Shariah-prescribed conditions.
Based on the hadith of Prophet Muhammad SAW narrated by Muslim, exchanging ribawi items of the same type must fulfil two conditions:
The amount exchanged must equal the amount received. RM100 must be exchanged for RM100 - no more, no less. Any excess or shortage constitutes riba.
The exchange must be done in cash and immediately (yadan bi yadin). There can be no delay - for example, giving money today but receiving new notes next week.
If either condition is not met, the exchange becomes haram.
Let us understand two types of riba that can occur in the context of exchanging duit raya:
Occurs when the exchange values are unequal.
Example: Ali wants to exchange duit raya. He gives RM100 to a small-note seller but only receives RM95 because the seller deducts RM5 as a "service charge".
This is riba fadhl because there is excess in the exchange of same-type ribawi items. According to Ustaz Azhar Idrus (Kosmo): "Exchange RM100, RM3 fee, so you get RM97 - haram and accursed."
Occurs when the exchange is not done immediately.
Example: Sarah asks her friend to exchange RM500 at the bank. She transfers money via online banking today, but her friend only gives the new notes next week after payday.
This delay makes the transaction riba nasiah, even though the values are equal.
Example: Ahmad wants to exchange duit raya. He gives RM500 cash to the seller and receives RM500 in new RM1 notes immediately. Then, he pays RM20 separately as a service fee.
This is permissible because both conditions are met - equal value and immediate exchange. The RM20 paid is not part of the money exchange but payment for services (ujrah).
Many people cannot distinguish between these two situations. The difference is actually very clear:
According to the Penang Mufti via Sinar Harian, taking a fee for exchanging money is permissible as long as the payment is made separately and not taken from the exchanged amount.
| Aspect | Cartel (Haram) | Service Fee (Permissible) |
|---|---|---|
| Exchange value | Unequal (RM100 = RM95) | Equal (RM100 = RM100) |
| Fee/charge | Deducted from exchange | Paid separately |
| Contract type | Pure money exchange | Wakalah + ujrah |
| Handover | May be deferred | Immediate/cash |
UAI emphasises that taking fees from the money exchange itself is haram. He gives this example: if someone exchanges RM100 and only receives RM97 because RM3 is deducted as a fee, that is accursed riba. The correct way: exchange RM100 = RM100, then pay the fee separately.
Through Irsyad Hukum Series No. 766, the Federal Territory Mufti Office explains that same-type currency exchange must be equal in value and done immediately (lani). Any charge that causes unequal values constitutes riba.
The Penang Mufti emphasises that exchanging money for new notes for duit raya purposes is permissible, but the exchange must be at equal value. He also reminds the public to avoid elements of riba in duit raya exchanges.
Here is a practical guide to ensure you do not fall into riba:
Yes, IF the fee is paid separately and NOT deducted from the exchanged money. You must ensure that RM100 requested for exchange is returned as exactly RM100. The RM5 fee is paid separately.
Yes, this could fall under riba nasiah because there is a delay in the exchange. The safe way: make the exchange face-to-face and in cash.
A licensed money changer exchanges DIFFERENT types of currency (e.g., RM to USD). The ruling differs because it involves two types of currency. A duit raya cartel exchanges the SAME type of currency (RM to RM) with a markup - this is problematic from a Shariah perspective.
If the envelope costs RM5 and contains RM1, this is not considered riba because you are buying an envelope (a product), not exchanging money. However, if the envelope costs RM3 and contains RM10, and the buyer actually wants the RM10 - be careful, as the intent is a money exchange with a markup.
Necessity does not make what is haram halal in the context of riba. Riba is a major sin prohibited absolutely (qat'i). Alternatives: use whatever money you have without exchanging, or give duit raya via online transfer.
If a husband asks his wife (or vice versa) to exchange money at the bank and there is no charge, this is permissible as it constitutes mutual assistance (ta'awun). The issue of riba only arises when there is a charge that makes the exchange values unequal.
Yes, the same ruling applies to all forms of fiat money - whether paper or coins. RM1 coin exchanged for RM1 paper - as long as it is the same currency, the conditions of tamathul and taqabud must be fulfilled.
There is no minimum amount. Even RM1 difference is still riba. As UAI emphasises: "Even RM1, it is haram to take fees (from the exchange value) for exchanging duit raya."
Exchanging duit raya is a beautiful tradition in Malaysian society. However, as Muslims, we must ensure this money exchange complies with Shariah. The key is simple: exchange at equal value, do it immediately, and pay any fees separately.
Do not let the excitement of celebrating Raya cause us to fall into riba - a sin against which Allah and His Messenger have declared war.
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