Establishment and Regulation of the Medina Market

After arriving in Medina, the Prophet established a new marketplace for the Muslims, separate from the market of Banu Qaynuqa which was the main commercial hub controlled by the Jewish tribes. The Prophet set regulations for fair trade that would define Islamic commercial ethics: he prohibited hoarding goods to inflate prices, forbade sellers from intercepting caravans outside the city to buy goods cheaply before they reached the market, prohibited price manipulation, banned najash (false bidding to drive up prices), required honest disclosure of defects in merchandise, and prohibited selling goods that had not yet been received. He said: 'The two parties in a transaction have the option of canceling as long as they have not separated. If they are honest and transparent, their transaction is blessed; but if they conceal defects and lie, the blessing is erased.' The Medina market became a model of Islamic economic justice.