Business Halacha: Borrowing Shekalim


shekelQ: Can I borrow and repay Israeli shekalim (NIS) in the States even if the shekel rises? Conversely, can a person in Israel borrow and repay dollars?

A: Although we are dealing here with monetary loans, this question actually relates to merchandise loans (se’ah b’se’ah), because foreign currency is considered “merchandise” or a “commodity” relative to the local currency. (C.M. 203:8) Therefore, it is permitted to borrow foreign currency only in the three situations mentioned last week.

  1. Yesh lo: If the borrower already has a shekel, he may borrow more. The lender may even sell or give the borrower a shekel, and then lend him additional shekalim. (Y.D. 162:2)
  2. Yatza hasha’ar: Some authorities suggest that since NIS are readily available on the foreign currency exchange, it should be considered as yatza hasha’ar. However, most poskim disagree, because the exchange rate fluctuates constantly. (The Laws of Ribbis, 14:14)
  3. Davar Mu’at: The application of davar mu’at to foreign currency is highly questionable, since it is not common to borrow foreign currency from neighbors.

All these halachos apply, conversely, to borrowing and repaying dollars in Israel. However, a minority of poskim suggest that the dollar is also considered currency in Israel and permit dollar loans, since use of the dollar is fairly common there. (Bris Yehuda 20:9)

Authored by Rabbi Meir Orlian

These articles are for learning purposes only and cannot be used for final halachic decision. The Business Halacha email is a project of Business Halacha Institute ( and is under the auspices of Rav Chaim Kohn.

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  1. With foreign money, there is another Eitza:
    One can do Haschalas Hamekach. This means to start the sale at the time of the loan. If Reuven borrows $1000 from Shimon in Israel, he should only borrow $999 and the last dollar should be “bought” from Shimon for that day’s shekel-dollar rate and will be paid back with the rest of the loan at its conclusion in dollars with no problem of Se’ah B’Seah because we can apply Yatza Hasha’ar and do not have the problem of fluctuating currencies because the borrower has “begun” to pay back the loan immediately after the loan being given.
    This is a very complicated but foolproof Heter and is based upon many Svaros in the Gemarah and Shulchan Aruch. It was discussed for an hour in our Chabura today.

  2. Comment #1 is unclear to me. Is the last dollar being bought or borrowed? When is it returned, on that day or with the loan? UNclear.