Though the use of the number “786” as a substitute for the Basmallah is widespread in some places it carries no weigh in the Shari`ah. Nothing can replace the divine words of Allah. Muslims are encouraged to stick firmly to the dictates of Shari`ah and to disregard all groundless forms and practices that have no Shari`ah-based backing.
Dr. Muzammil H. Siddiqi, former President of the Islamic Society of North America, states: “The number “786” is the total value of the letters of “Bismillah Ar-Rahman Ar-Rahim”. In Arabic there are two methods of arranging letters. One method is the most common method known as the alphabetical method. Here we begin with Alif, ba, ta, tha, etc. The other method is known as the Abjad or ordinal method. In this method each letter has an arithmetic value assigned to it from one to one thousand. The letters are arranged in the following order: Abjad, Hawwaz, Hutti, Kalaman, Sa`fas, Qarshat, Sakhaz, Zazagh. This arrangement was done, most probably in the 3rd century of Hijrah during the `Abbasid period, following other Semitic languages such as Phoenician, Aramaic, Hebrew, Syriac, Chaldean, etc.
If you take the numeric values of all the letters of the Basmallah, according to the Abjad order, the total will be “786”. In the Indian subcontinent the Abjad numerals became quite popular. Some people, mostly in India and Pakistan, use “786” as a substitute for the Basmallah. They write this number to avoid writing the name of Allah or the Qur’anic ayah (verse) on ordinary papers.
This tradition is not from the time of the Prophet, peace and blessings be upon him, or his Companions. It developed much later, perhaps during the later `Abbasid period. We do not know of any reputable Imams or Jurists who used this number instead of the Basmallah. It is better that we use the Basmallah, rather than using any mystery numbers. There is a great blessing in reciting the Basmallah before any important act.”