(Series of answers by the eminent scholar Ata Bin Khalil Abu Al-Rashtah, Ameer of Hizb ut-Tahrir,
to the questions of his Facebook page visitors "Fiqhi")
Answer to a Question
Credit Cards
To Ahmed Bin Hussein
Question:
Greetings, our eminent Sheikh, and my respect to you.
Peace be upon you and the mercy of Allah and His blessings,
My question: I wanted to buy some items in installments, but I encountered a doubt. It is that in the event of a delay in payment and they access the postal account and do not find their monthly portion, they deduct a small amount...
For example, if the agreement is that on the first of every month the normal deduction for the agreed amount is made, a small amount (two or three dollars) is deducted if they access it, for instance, on the 2nd or 3rd and do not find their money. This happens automatically and can occur more than once a day...
Knowing that when I reviewed the terms of the installment sale contract, this condition was not there, but it happens automatically in the case of a delay in payment. Is it permissible for me to conclude that contract and buy my items given the existence of that automatic deduction in the case of late payment?
May Allah reward you with all goodness.
Answer:
Wa Alaikum Assalam Wa Rahmatullahi Wa Barakatuhu,
My brother, the question seems a bit ambiguous to me. You say that you want to buy in installments and add that if they access your postal account and do not find their monthly portion, they deduct an amount... This matter is not clear. What I know and have been asked about previously is that some people open a bank account and take a card from the bank to buy from agreed-upon commercial stores, and the merchant takes the price of the sold goods from the customer's account in the bank. If the balance exists in the bank, it pays him the price of the purchases, and if this amount is not in the account, the bank pays it to the merchant but takes a specific amount in exchange for that from the account holder. If this is what is intended, then the card that the bank gives to the account holder falls under the category of credit cards... We have previously been asked such a question and answered it on 11/07/2006, and the following is the text of our mentioned answer:
(Credit cards are of several types:
- One type is where the holder has an account with a specific amount in the bank that issued the card. Then the cardholder purchases via it an amount not exceeding the amount placed in his account from participating commercial stores in several countries. The cardholder buys from these stores without paying; rather, he presents the card and signs papers for the value of his purchases, then refers the commercial store to receive the value of the purchases from the cardholder's account in the bank that issued the card. That is, the bank settles the value of the purchases to the commercial store from the account of the purchasing cardholder.
This type of card is permissible, and its reality is that it is (*Hawala* and *Wakala*). The buyer refers the seller to the issuing bank, so this bank acts as an agent (*Wakil*) for the buyer to settle the price of the purchases to the seller from the buyer's account at the bank. What the bank takes from the purchasing cardholder in exchange for settling the price of the purchases to the seller falls under the category of agency fees (*ujrat al-wakala*).
However, what the holders of these cards do regarding buying gold and silver without paying the price and referring the seller to the bank to receive the price—this action is *haram* (forbidden) because immediate hand-to-hand exchange is a condition for the validity of selling gold and silver, otherwise it is *riba* (usury).
All of this is if the bank is a private institution with a valid contract between its signatories, or owned by the state, then this type of card is permissible.
- The second type of card is issued by the bank to its customers without them having a sufficient account to cover their purchases. The cardholder purchases from participating commercial stores and signs papers by which the commercial store receives the price from the issuing bank. The bank records the amounts against the cardholder, plus an additional amount that the bank collects from the cardholder according to an arrangement for repayment in specific installments.
The reality of these cards is a guarantee (*Dhamman*) from the bank for the buyer toward the commercial stores. That is, the bank guarantees the buyer, and the commercial stores sell to the cardholder with the bank's guarantee. The issuing bank is the one that settles the value of the purchases; that is, the card is a guarantee document from the bank. The bank is the (*Dhamin* - guarantor), the purchasing cardholder is the (*Madmun 'anhu* - the one guaranteed for), the selling commercial store is the (*Madmun lahu* - the one guaranteed to), and the value of the purchases is the (right due upon the liability of the buyer).
However, this guarantee does not fulfill its Shari'i conditions because guarantee (*Dhamman*) in Islam is the joining of one liability to another for the settlement of a right due upon that liability without compensation (*Mu'awada*). The guarantor settles the right due upon the liability of the one guaranteed for to the one guaranteed to without compensation. But the bank settles the value of the purchases in exchange for compensation, i.e., a sum of money. Therefore, these cards are not Shari'i permissible from this perspective, in addition to the fact that the bank records the value of the purchases as a debt upon the buyer and collects it from him with an increase, i.e., with *riba*. Thus, it is also not Shari'i permissible from this perspective.) End.
If this is what you mean in your question, then the answer above is sufficient. But if it is not what was intended, then restate your question with sufficient clarification so we may look into its answer, Allah willing.
Your brother, Ata Bin Khalil Abu Al-Rashtah
10 Rajab 1439 AH
Corresponding to 28/03/2018 CE
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