A Critical Shariah and Maqasid Appraisal of Islamic

Credit Cards
Abdulazeem Abozaid1, Saqib Hafiz Khateeb 2

1,2 College of Islamic Studies, Hamad Bin Khalifa University, Doha, Qatar

Contact Author 1: [email protected]

Contact Author 2: [email protected]

Abstract - Islamic banks and financial institutions have recently equilibrium in society. Islam does not discourage
started issuing Islamic credit cards as substitutes for maximising wealth if it does not create a situation of social
conventional credit cards after the Shariah scholars, due to the distortion or violate the norms of Islamic justice. El-
Riba involved, unanimously deemed the traditional credit cards Bassiouny [3] summarises that Islamic finance's
unlawful. However, Islamic credit cards have different
structures; some have been structured based on Eina or
comprehensive goal is avoiding harm to all humanity and
Tawarruq sales even though these two types of deals were ruled promoting its properties. Speaking of the objectives of
unlawful by the Fiqh academies. However, the most common Islam, around which the general rules of Islam are based,
structure of Islamic credit cards is the Ijarah model, where the Dusuki, and Abdullah [4] refer that the key objectives
card issuer is deemed a lessor of the services embedded in the include safeguarding the religion, the intellect, the human
credit card, apart from the provision of credit, against fixed self, the progeny, and wealth. In Islamic financial
periodical fees. Although this structure seems acceptable from a institutions, adherence to Shariah principles is monitored
Shariah point of view and has been endorsed by the Shariah by either an internal or external Shariah Supervisory Board
boards of the issuing Islamic banks, it involves some issues that (SSB). This Board is a panel of Shariah scholars who
must be carefully addressed. The paper elaborates on these
critical issues and analyses the different contractual relationships
assess the products and practices of the institution and
involved in these cards to outline the prospectus of a genuine conclude about the institution’s compliance with the
Shariah-compliant credit card. Shariah requirements [5].
Islamic Finance is the fastest-growing sector of finance in
Keywords - Credit Card, Islamic Credit Card, Islamic finance, the world. Although it started in Muslim countries, it has
Islamic banking, Islamic product development also spread to non-Muslim countries and serves Muslims
and non-Muslims alike. Muslims count for around 24% of
I. INTRODUCTION the global population, and Islam is the world’s second-
largest religion, with the fastest growth rate, according to a
Islamic finance is a system that identifies and
Pew Research Center’s 2011 Report [6]. These factors
promotes economic and financial tools and products
have also assisted in the remarkable growth of the industry
consistent with Sharia's principles. Although Islamic
worldwide. Moreover, Biancone and Radwan’s [7] study
financial institutions share similarities with conventional
points out that countries worldwide are looking to
financial intermediaries as both are profit-maximising
introduce Islamic finance as an alternative financial system
institutions and offer traditional banking services. Still,
after the recent financial crisis. This is because, despite the
they differ in some of the principles under which they
latest financial crisis that caused difficulties for many
operate. Islamic principles require that earnings come from
conventional banks worldwide, Yilmaz [8] claims that
permissible means and be spent on good categories of
Islamic banks were broadly safe from the situation,
expenditure allowed in Sharia. Generally, Islam prohibits
courtesy of their prudent financial behaviours. The Islamic
investing in businesses that are considered unethical or are
finance industry has experienced exponential growth in
contrary to the Islamic ethical teachings and values, like
recent years, and the assets held under Islamic finance
dealing with Riba (usury/interest), Gharar
management have already crossed Reuters’ [9] expectation
(speculation/uncertainty), Maysir (gambling), and
of $1 trillion. Conventional financial institutions have
investing in unpermitted activities and businesses in Islam,
extended their operations to provide Islamic financial
like alcohol, tobacco, pork-related products, and
products catering to Islamic investors. Biancone and
pornography etc. [1]. Moreover, its investments should be
Radwan [10] highlight that entrepreneurs financed by
asset-backed or identified as an underlying tangible asset,
banks have been gradually increasing in most countries
and a proper application of the profit and loss-sharing
where Islamic banks operate, for example, the United
concept should be maintained [2].
Kingdom and Switzerland, where there is a more excellent
Islamic economics mainly regards wealth as a means for
achieving justice, equality, fairness, and economic

European Journal of Islamic Finance - ISSN: 2421-2172 14

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022

supply of entrepreneurs who have started demanding III. CREDIT CARDS, ITS ADVANTAGES AND DISADVANTAGES
Islamic financial products.
The paper is divided into seven sections. After the Islamic banks are required to expand marketable products and
introduction and literature review, the article discusses the services based on Islamic instruction standards. One of these
basis and features of credit cards, their advantages, and services, which is the focus of the study, is the Islamic credit
their disadvantages in section III. The following section is card. Financial institutions, typically banks, provide a credit
the appraisal of Islamic credit cards considering the card that enables the cardholder to borrow funds as loans from
objectives of Sharia, which is the main subject of this that institution under the agreement to repay the loaned
research. It covers the basics of the legitimacy of different amount by the bill’s due date or incur an additional agreed
types of Islamic credit cards and mentions the scholars’ amount. A credit card is a means of payment which involves
stances therein. Sections V and VI discuss two major buying first and paying later, as defined by Yee, Eam and
concerns in using credit cards and their permissibility. The Sanusi (2007) [16]. It is based on the principle of a loan
paper concludes by summarising the results and without interest (i.e., riba) if the loan is repaid on or before the
suggestions in section VII. specified date, i.e., the grace period, and with interest if
II. LITERATURE REVIEW
repayment is delayed beyond that time. Charging interest only
in case of delay beyond the agreed repayment period is one
Despite the expansion and growth of Islamic finance in the variety of Riba al-Jahiliyya, which is impermissible.
previous decades, its full potential has yet to be realised in According to OIC Fiqh Academy [17], resolution no. 108
various arenas. It must expand its services to innovative (2/12), issuing and dealing with conventional credit cards is
financial tools in tandem with Islamic principles to realise its unlawful due to this reason. Nevertheless, despite this Shariah
true potential. One such financial tool is the introduction of primary concern, credit cards generally have unique features
credit card products, like the already existing tool in and benefits for their holders and issuers.
conventional financial institutions. Al-Enazi [11] claims that A credit card is one of the most convenient and secure
Islamic financial institutions have adopted credit card payment tools accepted worldwide. It has replaced the need to
practices by altering specific components that contradict the carry cash, which is especially handy for international
Shari’a requirements, for example, by eradicating the interest- travellers where local currency is needed or where it is
based elements included within conventional credit cards. difficult to take large amounts of money in one or different
Most of the literature on an Islamic credit card is focused on currencies. The cardholders also benefit from increased
its basis from Islamic texts, and a few research, like Choo et purchasing power, in addition to being rewarded in the form of
al. [12], study the consumer’s choice of credit cards and their points, cash-back offers or gifts, prizes and discounts for using
acceptability. Other studies, like Johan & Putit [13], relate to the credit cards. The user may qualify for additional credit
the issues of people’s knowledge and religiosity influencing facilities if he can build a good credit history. A credit card
their decisions on whether to opt for credit cards or abstain holder can shop through the internet, where no cash payment
from them. On the other hand, Mansor and Azman [14] is accepted, allowing him more significant opportunities and
studied factors, like demographics, to observe whether they possibly better prices, such as buying travel tickets, booking
can be a good indicator for an Islamic credit card. hotels, and participating in international auctions. Cardholders
Given the substantial increase in electronic payments, to the use it for e-payments and electronic purchases to guarantee
detriment of cash payments, Islamic credit cards have already payment, which has sparked explosive sales growth for
penetrated the banking sector and are abundantly found in the expenditures on transactions which require a system of
market. But there needs to be more research considering the insuring payment (Fineberg) [18]. It can also be used to make
connection between current Islamic finance practices and their automatic recurring payments from the card, such as phone,
validity, given the complexities of modern-day financial water and electricity bills.
developments. But to ensure that the Islamic credit card and its Merchants also have a share of benefits from credit card
services can help strengthen the competitive position of systems like guaranteed payment, fraud protection, cash
Islamic banking vis-à-vis the conventional banking system, balance safety, and increased sales and revenue due to the
the banks must deepen their understanding regarding the boost in cardholders’ purchasing power. Credit cards increase
legitimacy and basis of such a product, too averse any Shariah business activities and profits because it provides people
risk emanating from such a product [15]. access to finance. Radishe [19] points out that this explains
The motivation for this paper comes from the necessity to why businesses consent to waive a specific percentage of the
appraise the current practice of Islamic credit cards from a value of their sale items (the interchange fee) for the benefit of
Maqasid perspective and to assess its legitimacy since its the credit card issuer. To this effect, the card issuers may grant
issuance and its underlying contracts while addressing the new cardholders’ attractive rebates to lure them into
Shari’a perspectives of credit card structures. This paper is subscribing to the card, especially on their first purchases or
exploratory and conceptual, providing insights for researchers, for a limited time. Since the credit risk of cardholders is
decision-makers, and practitioners on how Islamic credit cards shifted from the merchant to the card issuer, i.e., the bank, the
can prove better compliance with Sharia. merchants are guaranteed to receive the payments. It can also

European Journal of Islamic Finance - ISSN: 2421-2172 15

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022

help traders reduce the difficulty of handling cash in their indispensable tool for effecting payment. There is hardly a
businesses and the costs of transporting it to banks. single person living in a country with a developed financial
Similarly, the credit card issuers benefit from different types system who does not carry a credit card, especially in this
of penalties and fees like card issuing fees, annual card fees, digital era. According to the World Payments Report 2020
card renewal fees, cash withdrawal fees, late payment (Capgemini) [22], global non-cash transactions surged nearly
penalties etc., in addition to the price they charge to the 14% from 2018-2019 to reach 708.5 billion transactions, the
merchants for using the technological infrastructure that they highest growth rate recorded in the past decade. The report
use to accept payment through credit cards. It provides a profit predicts a compound annual growth rate (CAGR) of 12% for
for the issuers through a percentage on all purchases that are global non-cash transactions for 2019-2023. Does this pose a
charged (the interchange fee) to the merchants accepting the question: do these benefits justify using credit cards if the
card, in addition to the amount charged to the cardholder if he holder seeks to repay the loaned amount within the grace
delays the credit payment beyond the grace period as well as period? On the other hand, is the mere subscription to a credit
the amount charged for using the card to withdraw cash. This card a problem from a Shariah perspective due to the
interchange fee is permissible according to OIC Fiqh possibility of paying interest if there is an unplanned or
Academy resolution no. 108 (2/12) and according to the unintentional delay, or due to the implicit agreement of paying
Shariah Standard no. 2/5 issued by Accounting and Auditing riba in the case of delayed repayment?
Organization for Islamic Financial Institutions (AAOIFI) [20]. To answer these questions, the paper will present the supposed
Issuers may also charge issuance or periodical fees to the alternative to credit cards that Islamic banks provide. If this
cardholder regardless of whether the cardholder uses the card. alternative were sound from the Shariah perspective, it would
OIC Fiqh Academy’s resolution no. 108 (2/12) deems these free us from the need to use conventional credit cards, and it
permissible as they are against the embedded services in the would assist us in judging their use as impermissible.
card, apart from the credit involved.
However, credit cards have drawbacks for cardholders, issuers IV. CREDIT CARDS ISSUED BY ISLAMIC BANKS
and accepting parties. The conventional credit cardholder is
supposed to pay the considerable compound interest (riba) if Since conventional credit cards are based on debt financing,
he does not repay the credit amount before the end of the and any increment to the debt violates Islamic law, Islamic
grace period. The interest rate is estimated at around 2% per banks started issuing credit cards as an alternative to
month. The grace period is cancelled if an unpaid amount conventional credit cards after the latter was ruled
remains from the last period. The interest calculation begins impermissible, given the riba involved. The relationship
on the first day the monthly bill is issued. This could lead the between the conventional credit card issuer and the cardholder
cardholder to be gripped in the clutches of debt so that he may is based on riba if there is a delay in repayment beyond the
keep paying his debts for several years. The issuing parties grace period.
justify the high interest by the high probability of default and The OIC Fiqh Academy, in its resolution no. 63 (1/7)
failure to repay the debt. This means that some cardholders defines the credit card as “a document given by its issuer to a
pay on behalf of others to render this business as profitable to mutual or a juridical person based on a contract between them
the issuers. Apart from this financial disadvantage, credit card enabling it to buy goods or services from a vendor who
encourages its holder to buy unnecessary things, encouraging approves the document, without paying the price immediately
thus extravagance and the purchase of luxuries, which as the document includes the issuer's commitment to pay.”
contradicts moderate spending and good management of Financial institutions have devised different structures of
money. Abozaid [21] highlights that it contradicts the Shariah credit cards, to correct the riba-based relationship between the
stand on debt, as Shariah does not encourage incurring debts. issuer and the cardholder. Among these structures, the paper
However, it encourages providing good loans to those who are will discuss the most popular ones; credit cards based on ‘īna
impecunious and in need. The concept of credit cards or tawarruq, and service ijārah.
encourages consumerism and debt-taking, which leads to
mounting indebtedness and financial instability in society. The A. Firstly, credit cards based on Bay al-‘īna or tawarruq
traders also lose some profits from the credit card because the
banks issuing the credit cards discount a certain amount (2.5%
Tawarruq refers to buying a commodity from one party
on average) from the value of the sale items through the card on credit and selling it to a different party for cash to obtain
(the interchange fee). This could cause businesses to increase
cash. ‘Īna is a sale that is mostly resorted to to circumvent the
their prices to compensate for this deduction, and such an
prohibition of riba by selling a commodity to the person
increase is ultimately borne by the buyers. seeking financing at a deferred price then instantly buying it
Thus, credit cards contain benefits and harms for their users,
back at a lesser spot price. Thus, tawarruq shares the same
and it is left to the financial skills and knowledge of the user
objective of bay al-‘īna as both are meant for extending cash
and the way he/she chooses to use it. However, they have money. However, tawarruq remains technically distinguished
become part of the demands of modern life. With an increase from bay al-‘īna as in the latter, the commodity is resold to its
in Internet usage and the trend of e-commerce, and other original seller, while in tawarruq it is sold to a third party.
technological advancements, the credit card has become an

European Journal of Islamic Finance - ISSN: 2421-2172 16

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022

 Given that credit cards are used for financing - the bank the riba prohibition and yield the same result as a conventional
provides financing for the cardholders and gains its profits loan. Some Fiqh scholars, such as the Shafi’is, rule ‘īna as a
from that financing - and given that riba is regarded valid sale given its valid sale structure but ruling it as valid
impermissible, some Islamic banks structure their cards in the does not imply that it is permissible, since a valid contract is
following formulas as they do not regard practising tawarruq not necessarily permissible, as mentioned by Abozaid [26].
and bay al-‘īna as problematic.
The Islamic bank initiates a tawarruq or ‘īna sale with the
B. Secondly, credit cards based on service ijārah
customer. Then it creates a special account, i.e., the customer's
credit card account, and places the financing amount in it. The As mentioned earlier, credit card has several advantages
customer is then given a credit card with a credit limit equal to for their holders, merchants, and issuers too. The issuers may
the amount of financing stored in that account. Thus, the charge issuance fees or periodical fees to the cardholder
cardholder is using the card to pay from the money he got regardless of whether the cardholder is using the card. These
charges are deemed permissible by OIC Fiqh Academy
from the ‘īna or tawarruq procedure and has not borrowed
resolution 108 (2/12) as they are against the embedded services
anything from the card issuer, i.e., the bank. Once the monthly in the card or some privileges that may come with it, such as
bill is issued, the cardholder should top up that account, within club memberships, complimentary insurance, and discounts on
a specified period (like the grace period in a conventional some items, to name a few. In principle, placing fixed fees on
card), with the same amount spent on the bill, to renew the credit cards for such services is a permitted condition for the
balance of his credit card. permissibility of the services offered.
If the customer is late in repayments, the bank gains profit
(not riba) from the difference between the prices in the This is because it is permissible in Shariah to charge a fee
preceding ‘īna or tawarruq sale. For example, if the bank sells for a lawful service, just like it is permissible to demand a price
a commodity based on ‘īna to a customer for 15000 on a for selling a lawful commodity. Ijārah is a sale of a usufruct or
service, so it is a sale contract. The real usufructs that the card
deferred basis, and then buys it from him for 12000 on the
issuer provides to the cardholder justify for him to charge a fee,
spot, then the 12000 is set as the credit limit and is placed in
whether the fee is paid in one go, on a monthly or yearly basis,
the card’s account and not given to the client. If the customer or a mix of them. Further, different types of services justify
delays topping up the account beyond the grace period, the varying fees. A privilege card (like platinum or gold) may be
bank charges the client for this delay with a set amount charged higher for its valued services. The cardholder pays a
through the difference between the two prices, i.e., 3000. If the fixed fee to the issuer in return for services offered. This fee
client frequently delays repayment until the amount charged to remains the same regardless of the usage of the card, as in the
the customer has reached 3000, the bank requests him to sign case of conventional credit cards.
another ‘īna or tawarruq contract.
This means that the ‘īna or tawarruq contract does not However, Islamic banks that issue these cards waive the fee
come into effect if the client repays during the grace period or if the cardholder repays the full value during the grace period.
Otherwise, the bank obliges the cardholder to pay the full
returns the card without falling behind on his repayments. In
monthly fee, even if only a single penny is left to be repaid.
the latter case, the bank performs a clearing between the two Islamic banks grant this waiver regardless of whether the
prices in the īna or tawarruq; the price that it is due to the cardholder uses the services included in the card because the
client (12000) and the price that is due to the bank (15000). banks want their cards to remain equally competitive in the
The difference between them, i.e., the profit from ‘īna or market since conventional credit cards waive the additional
tawarruq, due to the bank, is waived. In the previous example, amount if the cardholder repays the billed amount within the
the bank exonerates the customer of the difference of 3000. grace period. Hence, one will find that Islamic banks offer
Exoneration also occurs if the client’s delay does not reach similar privileges to their customers as conventional banks.
3000, as the bank exonerates him or her of the remaining Nevertheless, there is no Shariah issue with this waiver, as it is
amount. given as a gift (hiba).
Shariah appraisal of ‘īna/tawarruq-based credit cards
Both ‘īna and tawarruq contracts are meant to justify C. Sharia’h appraisal of ijārah-based credit cards
profiting from cash financing, and as such, they are As stated earlier, a credit card provides some services that
impermissible. Tawarruq was ruled unlawful by the OIC Fiqh may justifiably warrant a fee. According to OIC Fiqh Academy
Academy resolution no. 19/5 since it involves a contrivance to resolution no. 108 (2/12), charging fees by the card issuer
riba. ‘Īna is, moreover, impermissible according to all jurists, against the services embedded in the card, except for the credit,
including Shafi’is, who only validate its contract based on it is permissible. However, according to OIC Fiqh Academy
being a contract that has fulfilled the contractual conditions of resolution no. 139 (5/15), these cards must not include any
a sale contract. However, as noted by Al-Kasani [23], Ibn prohibited service. Credit cards contains a loan, in the form of
Qudamah [24] and Al-Dasuqi [25], the Shafi’is regard it the credit card limit that the issuing bank provides to the
impermissible when it is intended to justify profiteering from a cardholder. This credit cannot be regarded except as a loan, and
loan contract. Hence, structuring credit cards based on them is profiting from a loan is impermissible, as it is riba. Hence,
impermissible. Nevertheless, some irregular fatwas appeared there are two components in a credit card: the services and the
recently to validate these two sales, designed to circumvent loan. A profit can be earned from the service, not the loan.
Combining a loan and any other contract like a sale or a lease

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DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022

entails caution from a Shariah perspective because the fee or V. EARNING FROM CASH WITHDRAWALS
the price might be increased in return for giving the loan, as in It is impermissible for the credit card issuer to profit from
the hadīth that suggests that “combining salaf and sale is not
cash withdrawals from ATMs using these cards. This is
permitted”. The Hadith, as reported by Abu Dawud (hadith no.
3504); Al-Tirmithi (hadith no. 1234); Al-Nasai’ (hadith no. because the withdrawal amount is a loan, and profiteering from
4611), Ahmad (hadith no. 6683), reads: a loan is riba. However, it is permissible for the card issuer to
cover its actual withdrawal costs, since the issuing bank incurs
“The Messenger of Allah, peace be upon him, said: “Salaf some costs for the withdrawal, especially when the withdrawal
with the sale is impermissible, or two conditions in a sale, or occurs in another country and with a different currency. On top
gaining from the sale of something without or before bearing of that, it is permissible for the card issuer to receive a fee for
its liability, or selling what you do not have”. the withdrawal service, provided it is no more than the fee
Al-Nafrawi [27] acknowledge that although this hadīth normally charged on debit cards. This is to ensure that the
refers to combining a sale with salaf, i.e., a loan, but like sale credit provided with the credit card remains free of charge.
in this regard is any commutative contract, such as ijarah, as However, when a withdrawal with a credit card occurs in
the jurists say. The reason for the prohibition is that the price of another country, it is permissible for the issuer to take a
the sale item could increase or decrease to cater for the loan. reasonable commission equal to the usual fee for exchanging
For example, the lender may tell the borrower: I will lend you and transferring money. This is because the bank issuing the
200 dollars on the condition that you buy this (specified) item card provides the service of both exchanging and transferring
from me for 50 dollars, though its market value is less than 50 money in this case.
dollars; or on the condition that you sell me this (specified)
item for 50 dollars, though its market price is higher than 50 In this regard, OIC Fiqh Academy, in its resolution no. 108
dollars. (2/12) ruled that: “cash withdrawal by the cardholder is a loan
Nevertheless, the outward text of this prohibition means from the issuer, and it raises no Shariah objection if there is no
that all exchanges combined with a loan are prohibited, ribawi increment. Not included are flat fees in return for this
including ijarah, an exchange contract. The effective cause of service and not related to the amount of the loan or its period,
the prohibition is clear, that is, using an exchange contract as a but any increment above actual service is impermissible and is
stratagem (tahayul) or a legal artifice to circumvent the sacred riba”. In this regard, it is worth noting that AAOIFI Shariah
law, to enable profiting from a loan. Accordingly, it could be standard no. 2 (4/5) also allows the issuer to charge a flat fee
acceptable to say that it is possible to excuse this combination against the service of cash withdrawal, but it does not restrict
[of sale and loan] if it is not used as a legal trick. However, two the permissibility of being against the actual service.
conditions must be met while applying this combination of sale
and loan to the credit card’s structure, in addition to not using it VI. USING A CONVENTIONAL CREDIT CARD WHEN NO REAL
as tahayul: ISLAMIC ALTERNATIVE IS AVAILABLE
(i) that the fee charged for credit card services should not be The problem with conventional credit cards is that riba is
higher than the normal market fee (if it can be approximated) conditioned and paid if the cardholder delays repayment.
for these services, and Payment of riba is a grave issue that is only permitted in cases
(ii) The fee should not change if the credit limit changes. of dire necessity. However, if the cardholder takes necessary
The fee may change if the credit card with a higher credit limit precautions to avoid payment of riba by keeping his
provides extra services of additional market value that make expenditures within his budget and opting for automatic
the difference in the fee compared to that of the lower credit deductions of the credit used from his bank account, then the
card limit. only matter that remains contested is his implicit agreement to
payment of riba. The cardholder receives the card after
Thus, it is prohibited that cards differ in their fees due to a undertaking to pay riba if he delays the repayment, and as
difference in their credit limit. However, if the cards with such, he is entering into a fundamentally impermissible
different credit limits come with different services, and the contract.
extra fee reflects the extra service's market value, then the fee
However, the following considerations might help ease this
difference can be justified. This implies that the cards that
particular concern:
differ only in credit limit while their services are the same may
not vary in fees. For example, if the gold-branded credit card 1) There needs to be a genuinely legitimate Islamic
has a monthly fee of 200 dirhams and its credit limit is 25,000 alternative that overcomes the riba problem in
dirhams, while the platinum-branded credit card has a monthly credit cards.
fee of 400 dirhams with a credit limit of 50,000 dirhams, and 2) The undertaking to pay riba is an enforced
there is no difference in the services offered by the two cards, condition (shart ith’āni) that cannot be changed or
then the difference of fee cannot be justified. Or if there is a dropped by the subscriber, and it is of no
difference but limited to a restricted number of complimentary consequence if the cardholder always pays during
valet car parking per month, for example, and the monthly the grace period.
market total value of this service is only 50 dirhams, then this 3) Many people in our time need credit cards to buy
makes the remaining amount between the fees (150 dirhams) in goods and services that may not be possible
return for the extra credit, i.e., the loan impermissible. through other means or for the same price. This is

European Journal of Islamic Finance - ISSN: 2421-2172 18

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022

 in addition to the inconveniences associated with Shariah and functions against its principle of
carrying cash especially given the risk involved, moderation in spending and debt incurring.
particularly for travellers. • On a final note, issuers of Islamic credit cards should
do all possible to block the card from being used to
Nevertheless, if a card that performs the roles of a credit buy unlawful commodities or services.
card comes to exist, and it is free from the credit, i.e., a loan, it
must be used instead. According to OIC Fiqh Academy
resolution no. 139 (5/15), using a (debit) card that does not REFERENCES
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European Journal of Islamic Finance - ISSN: 2421-2172 19

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
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European Journal of Islamic Finance - ISSN: 2421-2172 20

DOI: 10.13135/2421-2172/6816 - Published by the University of Turin
https://www.ojs.unito.it/index.php/EJIF/index
EJIF content is licensed under a Creative Commons Attribution 4.0 International License

Received: 08/06/2022 - Accepted for publication: 18/11/2022 - Published: 29/12/2022