Some banks require the borrower to pay two thousand riyals, which they call administrative fees. What is the ruling?
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Question:
Honorable Shaykh, may Allah grant you success. The questioner says: If I want to borrow from the bank, the borrower is required to pay two thousand riyals, and they call it administrative fees?
Answer:
Yes, this is riba (usury or interest) paid in advance, and they call it by a name other than its true name. They call it fees. This is not acceptable. The one who lends calculates and lends to people and takes only what was paid. But when he says these are fees, how is that? This is a deception regarding riba. Yes.
Honorable Shaykh, may Allah grant you success. The questioner says: If I want to borrow from the bank, the borrower is required to pay two thousand riyals, and they call it administrative fees?
Answer:
Yes, this is riba (usury or interest) paid in advance, and they call it by a name other than its true name. They call it fees. This is not acceptable. The one who lends calculates and lends to people and takes only what was paid. But when he says these are fees, how is that? This is a deception regarding riba. Yes.
Source
قناة «العلامة الدكتور صالح الفوزان»، [1719 -3022] بعض البنوك يطلبون من المقترض دفع ألفي ريالا ويسمونها رسوم إدارية، فما الحكم؟ — youtube.com
The Arabic text is a machine transcription of the audio recording.