Asslamualiekum Mufti Sahab, if someone take e.g Canadian dollars from someone in Canada and tell him to give e.g Pakistani rupees someone in Pakistan.
If he ask him more than exchange rate or any standard rate, just to mark up his deal, is this a RIBA transaction to make money on money.
Bismillahi Ta’ala
Walaikum Assalam Warahmatullah
Person A wants to sell his $100Cdn to Person W (middle man) for PKR Rupees, but then Person W should take and give these PKR Rupees to Person B in Pakistan.
This transaction is a Foreign Exchange transaction + Wakalah. The requirement is to conduct this transaction on a mutually agreed rate of exchange at the time of transaction (i.e. cash deal and not credit), even if it is different to the spot rate of the market.
Thereafter have Person W is arranged as a wakeel (agent) to take this money for Person A to Pakistan to Person B. Person W may charge a fixed fee from A for this work if he likes, and this will be separate from the profit margin he makes from the foreign exchange transaction.
Since the purpose here is essentially to have funds sent over to Pakistan for Person B, the same transaction can be arranged as a hawala which is also essentially the same transactions.
Person A mutually arranges an exchange rate with Person W for his $100Cdn, and include in this rate an in built fee of handling over the PKR Rupees to Person B in Pakistan. How, Person W arranges for this money to be handed over to Person B is not our concern. The transaction is Shariah Compliant.
Essentially this is how Western Union or Moneygram work. However, a point of caution is about arranging such transaction on a private manner is that it is considered illegal, and is construed as money laundering. So be careful, and adopt official legal means.
In case, when someone is going to Pakistan in person, making such arrangement will be Shariah Compliant, nonetheless.
Wallahu A’lam
And Allah Ta’āla Knows Best
Mufti Faisal al-Mahmudi