LessonsAdvance-Purchase Sale (سَلَم): Availability, Delivery Time and Financing UseQuiz

Even though the bank already has a contractual right to receive the Salam goods, it does not yet possess them. It therefore cannot simply sell those same goods as if they were already in its possession.

This rule prevents Salam from becoming paper trading of undelivered goods. A later resale must respect possession rules unless a separate valid structure—such as parallel Salam—is used.

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Why the Bank Cannot Sell Before Receiving the Commodity

Advance-Purchase Sale (سَلَم): Availability, Delivery Time and Financing Use

Even though the bank already has a contractual right to receive the Salam goods, it does not yet possess them. It therefore cannot simply sell those same goods as if they were already in its possession.

This rule prevents Salam from becoming paper trading of undelivered goods. A later resale must respect possession rules unless a separate valid structure—such as parallel Salam—is used.