SHARIAsource

This fatwa defines a 'shari'a card' as a card with a similar function to a credit card, which establishes a legal relationship between the card-issuer, card-holder and card-recipient, based on shari'a principles. It permits the usage of a shari'a card provided:

1. the card is not interest-bearing;
2. the card is not used for shari'a-non-compliant transactions;
3. the card does not encourage excessive spending (israf);
4. the primary card-holder has the financial capacity to repay the value of the card within the specified term; and
5. the card does not provide a facility that is contrary to shari'a.

The fatwa also permits a card-issuer to charge the user a membership fee (rusum al-'udhwiyah), as well as a merchant fee (ujrah), cash withdrawal fee (rusum sahb al-nuqud), and guarantee fee (kafalah). The card-issuer is also entitled to damages (ta'widh) or a late fee if the card-user is late in making repayments.