The Lajnah ad-Da’imah was asked the following question:
I bought meat from a butcher for six faransi [French] riyals a long time ago. The faransi riyal at that time was equal to 35 Yemeni riyals while now it equals 135 Yemeni riyals. The butcher asked me to repay him according to the latest rate. Should I repay him according to the old or recent rate? Appreciate your guidance, may Allah guide you.
If the reality is as you have mentioned, you should pay your friend silver faransi [French] riyals or their value at the time of repayment and not at the time of sale.
May Allah grant us success. May peace and blessings be upon our Prophet Muhammad, his family, and Companions.
The Permanent Committee for Scholarly Research and Ifta’
Note: A group of scholars say the origin is that a person tries to pay the debt back in the currency which the transaction was binded upon whether its value goes up or down. However, if it was a loan and the rate of the currency were to go down, then it is highly recommended that the person repays the person with the higher rate when the person was initially given the loan due to the hadeeth:
إِنَّ خِيَارَكُمْ أَحْسَنُكُمْ قَضَاءً
Prophet (ﷺ) said, “The best amongst you is the one who repays the rights of others generously.”
Reported by al-Bukhaari and Muslim
Likewise, see the audio below of the opinion of Shaykh Albany rahimahullah on the matter so it is made aware of the difference of opinion in the matter In Shaa Allaah. In it Shaykh Albani mentions that the money should be paid according to the exhange rate of the day he was owed the money:
Listen / Download [Shaykh Albani’s opinion starts at the minute 2:25 mark]