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Jami at-Tirmidhi 1313 (Book 14, Hadith 116) #26889
Permitted and Prohibited Transactions

SUMMARY: The Prophet ﷺ prohibited certain types of transactions and permitted one type of transaction.

Narrated Abu Az-Zubair: From Jabir that the Prophet prohibited Al-Muhaqalah, Al-Muzabanah, Al-Mukhabarah, and Al-Mu'awamah, and he permitted it in the case of Al-'Araya. Abu 'Eisa said: This Hadith is Hasan Sahih.
حَدَّثَنَا مُحَمَّدُ بْنُ بَشَّارٍ، حَدَّثَنَا عَبْدُ الْوَهَّابِ الثَّقَفِيُّ، حَدَّثَنَا أَيُّوبُ، عَنْ أَبِي الزُّبَيْرِ، عَنْ جَابِرٍ، أَنَّ النَّبِيَّ نَهَى عَنِ الْمُحَاقَلَةِ وَالْمُزَابَنَةِ وَالْمُخَابَرَةِ وَالْمُعَاوَمَةِ وَرَخَّصَ فِي الْعَرَايَا ‏.‏ قَالَ أَبُو عِيسَى هَذَا حَدِيثٌ حَسَنٌ صَحِيحٌ

EXPLANATIONS:
This hadith is about the different types of transactions that are allowed or prohibited in Islam. The Prophet Muhammad ﷺ prohibited four types of transactions which are known as al muhaqalah, al muzabanah , al mukhabarah and al mu’awamah. However he allowed one type of transaction which is known as al ‘araya. This hadith teaches us that we should be careful when it comes to our financial dealings and only engage in those activities that have been approved by the Prophet ﷺ . We should also strive to be honest in all our financial dealings so that we can gain Allah’s pleasure.

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