Ruling on Mubaarak credit cards

Question

Praise be to Allah.

There is nothing wrong with
using credit cards that are free of the following shar’i reservations:

1 – Stipulating that
interest or a penalty be paid in the event of late payment.

2 – Taking a percentage of
withdrawals if the credit card is not covered. It is permissible to take a
set fee for work only; anything more than that is riba.

3 – Buying gold, silver and
currency with a card that is not covered.

See the statement of the
Islamic Fiqh Council on this issue in the answer to question no.
97530.

We have not studied this
particular card, but Dr Muhammad al-‘Usaymi (may Allaah preserve him) was
asked about it and he replied:

I stated that it is not
permissible, because there is no reason for the extra monthly charge which
is in addition to the actual cost, except the loan taken through the card,
and that is the essence of riba. Moreover, it imposes a penalty on the one
who is late in paying, which they call a fee for late payment, which is riba
that is forbidden in the Qur’aan, even if they claim that it will be donated
to charity. The Messenger of Allaah (peace and blessings of Allaah be
upon him) was in the most urgent need of money to give to the poor and needy
among ahl al-suffah, but he abolished all the riba of the Jaahiliyyah. I
warn myself and my brothers to beware of the traps of the shaytaan,
especially with regard to riba. One of the main ways in which riba was
introduced to the Christians was the imposition of riba for late payment of
personal loans. And Allaah is the One Whose help we seek. End quote from the
website of Shaykh al-‘Usaymi.

(in Arabic:

http://www.halal2.com/ftawaDetail.asp?id=393
)

He also said:

If it is as the questioner
described then it is haraam. I reiterate that the bank will charge a monthly
fee from the customer under the name of bank charges. Undoubtedly charges
for cards which offer loans should be based on the actual work involved for
the issuer, which is the bank, and it is not permissible for it to make a
profit from those charges, because the loan that is given through the card
will be a riba-based loan if the bank charges an administrative fee that is
greater than the actual costs of the work done. I call upon my fellow
Shaykhs and muftis who have ruled that it is permissible to recant those
fatwas, because riba is haraam and it initially started in the kaafir west
through such charges. And Allaah knows best. End quote.

(in Arabic:

http://www.halal2.com/ftawaDetail.asp?id=8215
)

And Allaah knows best.