Credit card charges

QUESTION:

Bank charges are incurred when a person makes payments online. Is it permissible to use this form of transaction, even if the bank charges are paid by the creditor.

ANSWER:

Your question is not too clear to us. We understand the usage of credit cards as follows; the card holder uses the card to make purchases and is given a 55 day, interest-free period to settle the account. If he pays the balance on the card within 55 days via EFT, then he is not charged interest or a cash deposit fee. This is in order. If he settles the balance using cash at the bank or ATM, then he is charged a cash deposit fee. This too is in order as the bank is charging a fee for their services.

Yes, the shopkeeper who swipes the card for his clients is charged a fee of approximately 3% for every purchase by the bank. We are not fully aware of the reasoning behind the charge. If the charge is for the usage or hiring of the credit card machine, then the transaction will be corrupt, as the fee for using the machine should be fixed. If the bank or credit card company charges an admin fee for every transaction, as there is administration work involved with every transaction, then the fee will be legitimate. Also, the shopkeeper is fully aware of how much he is going to be charged for the transaction. In conclusion, if the fee levied upon the shopkeeper is in lieu of admin charges, then it will be acceptable.

We hope that the above explanation clarifies the matter. If your question pertains to other than what we have explained above, then you should resend your query for further clarification.

ALLAH TA’ALA ALONE IN HIS INFINITE KNOWLEDGE KNOWS BEST!

ANSWERED BY:

Mufti Mohammed Desai

Date:- 13 Muharram 1445 / 01 August 2023