What is the ruling on credit cards?

The questioner : In your question, may Allah reward you with good.

The Shaykh : Please go ahead.

The questioner : Have you researched credit cards? The issue of credit cards.

The Shaykh : Yes, exactly.

The questioner : The ones that some Muslims handle?

The Shaykh : By Allah, I do not have a specific research on it, but if it has no connection to banks, it is a transaction that involves facilitation; however, what came to my mind is that the issue is linked to banks; is that so?

The questioner : Yes, Express is a large bank.

The Shaykh : How?

The questioner : Yes, it is linked to banks; all transfers are through banks.

The Shaykh : That is the case. Undoubtedly, bank operations facilitate transactions for merchants, and this encourages them to deal with banks; but we return to our previous statement when the question was asked about the niqab and covering the face, that facilitation is not in our hands; we want to adhere to the rulings of the Shari'ah; so the fact that a bank facilitates transactions for people and their trades, especially in foreign countries, is not sufficient in itself to justify this operation and legitimize it and make it permissible. Rather, it must be weighed by the scale of the Shari'ah. If the Shari'ah does not prohibit it but permits it, then that is excellent; but by Allah, we want to deposit money in a bank and people benefit from it, and similar riba transactions, that is not permissible. If this card is based on this type of dealing, its ruling is the same as other transactions with banks; but if it has another form that we perhaps do not know, we hear it or renew our hearing of it, do you have anything?

The questioner : Yes.

The Shaykh : Please go ahead.

The questioner : If you please, this card is issued without a balance; you do not have to have a balance in the bank.

The Shaykh : I mean, can I, for example, take it?

The questioner : You can take it without a balance.

The Shaykh : How do you mean?

The questioner : If they trust you, a reference from work, a reference that you are known.

The Shaykh : Here is the problem.

The questioner : A letter from work.

The Shaykh : If they do not trust us, what do they want? We need to have a balance.

The questioner : Yes. From the aspect of me taking an employee reference.

The Shaykh : Please go ahead.

The questioner : The issue is that you must pay the bank four hundred riyals per year.

The Shaykh : How?

The questioner : Four hundred riyals per year; you pay this amount to the bank in exchange for using this card; this is an issue, meaning...

The Shaykh : What does the four hundred riyals correspond to?

The questioner : That I can take a sum of one hundred thousand Saudi riyals from this card anywhere in the world, buy anything, I carry only this, I enter any hotel, eat, drink, and buy, and so on, I give them only this card, and they transfer it to my account on this number, and the claims are processed in Riyadh, and I settle it with the bank without any increase, not even one percent.

The Shaykh : Wait a moment, suppose I obtained this card for four hundred riyals every year, clearly to facilitate the purchase process without the buyer carrying hundreds, let alone thousands, of currencies. I went to a country and bought thousands upon thousands; how do they get it?

The questioner : They fill out small forms, they write the number, the number is very long, one million three hundred and seven thousand and four hundred and... so they call the bank here in Jordan and say, is there any note on this card? They say no, so immediately they disburse the amount to them...

The Shaykh : Okay, one by one, the bank does not know me.

The questioner : It knows the number, if they gave you a number...

The Shaykh : Where does this number come from?

The questioner : The bank that gave it to you in Riyadh; they disseminate it to all banks in the world on the same day.

The Shaykh : I mean, if you say in Riyadh, for example, if I obtained this card and it has this long number, it is disseminated to all countries of the world. Okay, I bought, I did not buy, how does the bank get this money from me later?

The questioner : If they request this number, it becomes clear to them that it belongs to a person in Saudi Arabia in Riyadh.

The Shaykh : No, no, you tell me about me now, I am speaking about myself, I am speaking about myself.

The questioner : You spent it, where are you in Amman?

The Shaykh : I am saying I obtained this card from a bank here, and as I heard from you, I do not deal with banks, but perhaps some banks trust me, for example, or know me, or so on, so they got involved—we say they got involved—and gave us a card, and I went and traveled the world and bought goods to the extent that this card allows me. How much did you say? How much did he say?

The questioner : One hundred thousand Saudi riyals.

The Shaykh : One hundred thousand riyals, I bought goods and came to my country, how do they get it from me?

The questioner : They have your address, they send you a claim by mail.

The Shaykh : So they knew my address and came to me and demanded it, and I do not have it, what do they do?

The questioner : They have a reference for you, and a person who vouched for you or a person who introduced you to them, they demand it from him and file a case in court and summon you until you pay the amount.

The Shaykh : How?

The questioner : They imprison you if you do not pay the amount.

The Shaykh : Okay, they do not imprison me, I have a little money, how do they demand the money from me?

The questioner : You must pay it within two months, within two months; if you do not pay it within two months, it is doubled on you by five percent.

The Shaykh : Here is the problem, indeed deeds are judged by their endings, this is the problem—laughs.The Shaykh : (may Allah have mercy on him).

The questioner : Only in Saudi Arabia, they do not take five percent; if you go to the court, the judge says you take your principal only, just that.

The Shaykh : This means it became a local ruling specific to you, not a legal system?

The questioner : The judiciary in our place does not recognize the increase.

The Shaykh : Yes, but this is by the ruling of the card, whereas this is by the ruling of the Shari'ah; so here, for example, or in Egypt or in other countries, they demand an increase, so for this reason I said what I said. When I want to take this card, I need to look at the outcome. The outcome, I now know that they will demand from me more than what I bought, and this is the truth: all riba transactions end with what they call interest, which is in fact riba; but if there is no such riba, I return and say this card is very necessary for travelers.

The questioner : ... .

The Shaykh : How?

The questioner : I say, then, if there is a delay in payment, it becomes riba; but if there is no delay, there is no riba.

The Shaykh : Yes, but a person has to calculate that he might not have money for payment, like in bank transactions, sometimes if there is a delay, they increase it.

The questioner : No matter how long the delay, Shaykh, two months is a very long period; I can never be delayed. I have dealt with them for four or five months; every time a bill comes, after four days I give them the installment; I have not been delayed at all.

The Shaykh : No, the issue is regarding adherence to the Shari'ah, meaning the case seems to have ease in it; but a person has to estimate that he may fall into something he did not anticipate, in which case he is forced to pay them an increase, except in your place. Okay, in your place, the problem is solved.

Another questioner : Does that mean it is permissible for them and not permissible for us?

The Shaykh : Yes, exactly.

The questioner : From the standpoint of trustworthiness.

The Shaykh : How?

The questioner : From the standpoint of trustworthiness, an issue I overlooked; they take five percent from the one who sold the goods to him.

The Shaykh : Ah. I understand you.

The questioner : I mean, they say that this is a customer of ours who came to you because you accept this card, so five percent is for us. So they took one hundred from me but gave the goods owner ninety-five. This does not harm me; it harms them, and this is advertising.

The Shaykh : Okay, is this brokerage or riba?

Another questioner : They are working on a brokerage system, meaning I am the one who brought you this customer.
Abu Layla : The amount of the five percent that he wants to take, complete it, our Shaykh.

The Shaykh : Yes, what do we want to count this as, riba or not riba? It does not seem to me except that it is riba.

The questioner : I mean, every loan that brings benefit.

The Shaykh : Ah, but here.
Abu Layla : There is a note: if, for example, the five percent was not increased by the merchant who sold the goods to this customer at the bank, but the bank took it from the merchant.

The Shaykh : If it were like that.

The questioner : Yes.

The Shaykh : Is that the situation?

The questioner : Yes, that is the situation, that is the form; they did not take anything from me, they took it from the goods owner.

The Shaykh : Ah, but they did not take anything from you. Sometimes here, for example, in transactions like a car that needs a part, the mechanic or engineer, as I think you call them in that country, the car owner sends someone to a parts dealer he has an agreement with. He tells you, for example, this part is fifty and that part is one hundred, and so on. He gives you a bill, but in the bill he gave you, he calculated what he wants to deduct from you?

Another questioner : A deduction for his benefit.

The Shaykh : A deduction. Do you understand?

The questioner : ... .

The Shaykh : This is not permissible here, because he deducted an extra amount from you in order to give it to the one who sent you to him. So I do not rule out that the case is like this.

The questioner : This is not the case.

The Shaykh : It is not the case.

The questioner : This is absolutely not the case.

The Shaykh : Why?

The questioner : Now, a perfume shop in Riyadh announced a thirty percent discount for the general public.

The Shaykh: Okay

The questioner : Goods priced at one hundred are sold for seventy. I came and said to him, I want this perfume for one hundred riyals or for seventy riyals, and he gives me the same price as the people.

The Shaykh : The same price.

The questioner : No increase and no decrease. They have instructions saying that if anyone increases your price by one percent over the people with whom you are, call us immediately, and we will revoke his membership. We revoke the merchant's membership. So there are guarantees that prevent this. But there is an issue, O Shaykh, that I also raised.

The Shaykh : Please go ahead.

The questioner : I am now in Jordan, and my money is in Saudi Arabia. If I transfer money from Saudi Arabia to Jordan for twenty-five riyals, every transfer is twenty-five riyals. So now I went to the market here in Amman and bought six times in six days, meaning six transfers. And here in Zarqa, six times, six transfers. How much did I save? A large amount. If I bought a hundred times for twenty-five riyals.

The Shaykh : Enormous amounts.

The questioner : With just two thousand five hundred riyals, this is the cost of the transfer. Financial transactions going back and forth by telex, who pays for all of it? This card, I do not lose a single qirsh in it. I saved, I benefited.

The Shaykh : No problem, we have acknowledged that banks facilitate transactions, without a doubt. But the important thing is that the Muslim does not fall into a religious violation. So now, all our concern is searching to see if there is no violation or if there is. As for facilitation and saving, that is clear. I said earlier, what if a person wants to go to America and Europe and does not want to carry currencies with him? If he wants to buy, he must carry currencies, meaning he might be exposed to the risk of loss, robbery, snatching, and so on. So the benefit is present entirely, but we are trying to ensure that there is nothing in this transaction that violates the Shari'ah. You are now in a practical situation, we are thinking theoretically, you are now thinking practically. Because the card is with you, you buy, and you know more than we, the theorists, that perhaps there are violations of the Shari'ah or not. So I did not feel, if Allah wills, that there is anything in the violations, or is there?

The questioner : From my side, O Shaykh, I did not feel any issue and my heart is at ease, O Shaykh. Because I believe it is a facilitation and that it is a new transaction.

The Shaykh : Do not go back and call it a facilitation, because that is called justification later.

The questioner : There is only the issue of the four hundred riyals that are taken in the year.

The Shaykh : There is no objection to this being, for example, a fee.

The questioner : The transfer fee, yes.

The Shaykh : What is the opinion of your Shaykhs there, so that we can benefit from their opinions?

The questioner : By Allah, O Shaykh, they say it is riba al-nasi'ah (usury of deferment).

The Shaykh : How?

The questioner : The Shaykh : Abdullah Rizaq Al-Affayy says that it is riba al-nasi'ah (usury of deferment). I said to him, how, O Shaykh, is it riba al-nasi'ah (usury of deferment)? Of course, I was talking to him on the telephone, so he said, ask someone else, ask someone else, and he hung up the phone.

The Shaykh : But?

The questioner : Yes, he was busy...

The questioner : And I heard from some of the brothers that there is a fatwa from the Permanent Committee, but I was not able to obtain it because that is not facilitated.

The Shaykh : A fatwa for whom?

The questioner : For the Permanent Committee, the Ifta Committee in Riyadh.

The Shaykh : There in Riyadh, and I did not know what its content was?

The questioner : No, I did not know. But O Shaykh, a Visa card is different, it is different from an Express card. These people reserve an amount of seven thousand riyals, it must always be in the bank.

The Shaykh: Who is it?

The questioner : Visa, a Visa card, a second type.

The Shaykh : A second type.

The questioner : ... But they require that you reserve an amount in the bank, which they invest, they play with it, meaning they engage in riba (usury or interest) with it. But the American Express card does not require an amount, so it does not require that you have a balance or anything. So I...

The Shaykh : And what is the nationality of the company?

The questioner : American, O Shaykh.

The Shaykh : And the other one?

The questioner : All American.

The Shaykh : All American.

The questioner : Recognized in all countries of the world.

The Shaykh : Okay, can you buy anywhere here?

The questioner : No, not everywhere.

The Shaykh : Not any place, so how do you know?

The questioner : There is a sign on the shop. If I come to a hotel, I see the hotel that accepts this card. For example, out of twenty hotels, fifteen deal with it.

The Shaykh : No problem, this is a hotel, but when you want to buy goods, how? Are you going to ask?

The questioner : No, there are signs on the wall or on the board of the shop.

The Shaykh: What are they?

The questioner : A picture of the card, it is large.

The Shaykh : A picture of the card, have you seen such a thing?
Abu Layla : But the Visa one he is talking about is present.

The questioner : And American Visa, all are present in Zarqa, I did not notice...

Another questioner : ... the Islamic bank.

The questioner : All banks accept them, all of them accept them.

Another questioner : The Islamic Bank has a box and it is written on it Express.

The questioner : O Shaykh, they have very big advantages. You cannot rent a car in some countries except with this card. If you do not have this card, they want the money in cash in advance. But if you have the number, that is it...

The Shaykh : By Allah, this card must be studied precisely. Because the truth is that this conflicts with bank transactions.

Another questioner : My Shaykh, the banks are benefiting, they.
Al-Halabi : On both sides.

The questioner : They benefit from the four hundred riyals that are paid, and they benefit from the merchant they deal with. But as long as they do not increase the price of the goods, the reason for the previous inquiry is that the merchant is served and the Express company is also served by the fact that it receives profits from the merchants through this service. But nothing has come upon the customer, and this is what we fear and what we warn about, O Shaykh. The fear is that riba (usury or interest) has reached the Muslim customer. So the riba (usury or interest) did not reach the customer, and they did not take the riba (usury or interest)...
Al-Halabi : And the most the company profits is taking from the customer and from the merchant, and this is four hundred annually.
They use it, and even if they do not use it.

The Shaykh : They are going to benefit from the customer for sure, even if he does not use it. If he uses it, the second profit from the merchant is added.

The questioner : If you wish, O Shaykh, I will write you a book on the subject in detail if I return to Riyadh, if Allah wills, in safety, I will write you a book.

The Shaykh : By Allah, that would be good.

The questioner : You would be doing us a favor. We have many young people here with these cards and they are hesitant to use them. Some of them say we will return them, and some of them say this and that.

Another questioner : Our Shaykh, this is new, according to what I heard from the young people who have a Visa card here, that the riba (usury or interest) returns to the customer through the door of two sales in one sale.

The Shaykh : And the merchant?

Another questioner : And the merchant takes from this one and takes from that one, from both sides. They are working in furniture showrooms and they have put the logo and they say we take our money and you have no relation. This is one hundred and fifty, we take it from the bank, but the bank did not give them the price and it increased for them. This is with Visa.
Another session in the car.