A card issued by some companies to facilitate individuals' transactions in the markets
Machine translationRead the Arabic original
Fatwa No. ( 3675 )
Q: There is in America a type of contract between the individuals who are parties to the contract, as the first party, and the company that provides services to these individuals, as the second party. The contract includes the following: A- The company issues a card bearing the number and name of the individual who is a party to the contract. The individual can use this card in commercial establishments to pay for what he purchases, as well as in restaurants and hotels, and to purchase airline tickets from airlines, among other things. The establishments from which the cardholder purchases send the value of the purchases to the company that issued the card, to pay the amounts owed by the cardholder. B- At the end of the month, the company that issued the card sends an invoice to the cardholder and requests him to pay all the amounts owed to him for that month only, which the company paid on his behalf to the owners of the commercial establishments. C- The individual is required to pay the amount owed to him within a maximum of 15 days from the date the invoice is sent. If he does not pay within the specified period, the company sends him a second invoice for the same amount owed, which has not been settled, with an increase of 10 dollars as a late fee. If the individual does not settle the amount after the second invoice is sent, the company sends him a third and final invoice, requesting him to pay the amounts
owed to him, with an increase of 2.5 percent of the value of the amount as a late fee, and in this case, it also cancels the contract and withdraws the card. E- The duration of the contract is one year, and the cardholder must pay an amount of 30 dollars annually as a fee for the subscription and for issuing the card to him. F- Payment and the invoices sent are in US currency. If the individual uses the card in countries outside America, the company sends the invoice in US currency by converting the value of the amounts owed from other currencies to US currency (the dollar). The exchange rate is the rate on the day the invoice is sent, not the rate on the day the cardholder used his card for purchases outside America. He is required to pay the value of the amount owed in dollars with an increase of 1 percent as a fee for conversion and currency exchange. G- Either party is permitted to cancel the contract at any time after notifying the other party of the cancellation. We ask your eminence to kindly answer: Is this contract permissible or not? If it is permissible for a Muslim to subscribe to this contract, we ask you to clarify the nature of the contract or the reasons for its permissibility, and whether it is a contract of agency, guarantee, or lease between the individual and the company issuing the card? If it is not permissible, we ask you to clarify the reason that makes the contract defective or invalid .
A : If the matter is as described, then the increase that the company takes is a type of riba (usury or interest), so it is not permissible for it to take it; because riba is forbidden by the Book, the Sunnah, and scholarly consensus. If this contract is without benefit, it is a contract of guarantee, and guarantee is one of the contracts of facilitation. If it is with benefit in case of delay in settling the amount, it is not permissible for the aforementioned reason. Likewise, paying thirty dollars annually in exchange for his subscription is not permissible; because this is taking a fee for the guarantee.
Q: There is in America a type of contract between the individuals who are parties to the contract, as the first party, and the company that provides services to these individuals, as the second party. The contract includes the following: A- The company issues a card bearing the number and name of the individual who is a party to the contract. The individual can use this card in commercial establishments to pay for what he purchases, as well as in restaurants and hotels, and to purchase airline tickets from airlines, among other things. The establishments from which the cardholder purchases send the value of the purchases to the company that issued the card, to pay the amounts owed by the cardholder. B- At the end of the month, the company that issued the card sends an invoice to the cardholder and requests him to pay all the amounts owed to him for that month only, which the company paid on his behalf to the owners of the commercial establishments. C- The individual is required to pay the amount owed to him within a maximum of 15 days from the date the invoice is sent. If he does not pay within the specified period, the company sends him a second invoice for the same amount owed, which has not been settled, with an increase of 10 dollars as a late fee. If the individual does not settle the amount after the second invoice is sent, the company sends him a third and final invoice, requesting him to pay the amounts
owed to him, with an increase of 2.5 percent of the value of the amount as a late fee, and in this case, it also cancels the contract and withdraws the card. E- The duration of the contract is one year, and the cardholder must pay an amount of 30 dollars annually as a fee for the subscription and for issuing the card to him. F- Payment and the invoices sent are in US currency. If the individual uses the card in countries outside America, the company sends the invoice in US currency by converting the value of the amounts owed from other currencies to US currency (the dollar). The exchange rate is the rate on the day the invoice is sent, not the rate on the day the cardholder used his card for purchases outside America. He is required to pay the value of the amount owed in dollars with an increase of 1 percent as a fee for conversion and currency exchange. G- Either party is permitted to cancel the contract at any time after notifying the other party of the cancellation. We ask your eminence to kindly answer: Is this contract permissible or not? If it is permissible for a Muslim to subscribe to this contract, we ask you to clarify the nature of the contract or the reasons for its permissibility, and whether it is a contract of agency, guarantee, or lease between the individual and the company issuing the card? If it is not permissible, we ask you to clarify the reason that makes the contract defective or invalid .
A : If the matter is as described, then the increase that the company takes is a type of riba (usury or interest), so it is not permissible for it to take it; because riba is forbidden by the Book, the Sunnah, and scholarly consensus. If this contract is without benefit, it is a contract of guarantee, and guarantee is one of the contracts of facilitation. If it is with benefit in case of delay in settling the amount, it is not permissible for the aforementioned reason. Likewise, paying thirty dollars annually in exchange for his subscription is not permissible; because this is taking a fee for the guarantee.
Source
www.alifta.gov.sa
The Arabic text is copied verbatim from the original source, without any edits.