Commodity
loans - such as a loan of a bag of wheat to be repaid with a bag of
wheat at a later date - are generally prohibited. If the price of the
commodity increases in the interim, the lender will receive back more
value than he lent, which constitutes interest. The correct way to give
such loans is to estimate the value of the bag when it is given, and
later return the amount of wheat of equal value.
Nevertheless,
a person may lend his sharecropper wheat to be used as seeds, for
repayment of the same amount of wheat after the harvest. In this case
it is not a commodity loan but terms of shareholder agreement.
