Are Credit Cards Haram or Halal?

Are Credit Cards Haram or Halal? Yes credit cards are deemed to be illegal since banks accrue interest from the money given to the customer. This adds to annual fee for subscription as well as other charges that need to be paid even if a customer is able to pay on time.

This is considered to be Riba and is considered prohibited in Islam. Customers are expected to pay interest if they are late in paying their bills and is considered to be as haram.

Can credit-card companies be considered scams? No doubt, credit cards are appealing. They offer the convenience and speed for borrowing funds.

But, what people do not realize is that credit card usage could be extremely risky. What’s the real truth? Are credit cards considered illegal? There’s no definitive answer. You should read the article to the end to get the solution.

Table of Contents

  • What is Haram? be Haram?
  • What is the meaning of credit cards?
  • How are Credit Cards Work?
  • Are the Credit Cards Haram?
  • FAQ
  • Are available Islamic credit cards accessible?
  • How do you feel about it? are the alternatives to credit cards that are available for Muslims?
  • Do I have the option of using my credit card make a donation or for charities?

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What is Haram?

Haram finance is an aspect of financial transactions that is believed to be in contravention of the principles of Islam. This can include things as charging interest on loans and investing in companies that are morally unsound or making predictions regarding the value of commodities that they will soon be. There’s some disagreement about what qualifies as haram financial transactions, however, the majority is that’s considered to be harmful to an individual or society as a whole.

Haram finance is an important issue within the Muslim world, as more and more people are becoming aware of the dangers associated from engaging in such practices. Beyond the moral implications and the dangers to financial security that are associated with haram finance. For example, investing in any business involved in activities that are considered as haram may result in capital losses should the business does not succeed.

There are a variety of Islamic banks which have been established in recent years with the intention of offering alternatives to traditional banking products and services. They offer products and services that are in line with the principles in Islam and, consequently, they are able to stay away from the risks associated with haram lending.

Islamic financial institutions offer a variety of options and products. They offer savings accounts, mortgages and investments. These services and products were designed to help Muslims to save money, acquire homes, or invest their funds in various businesses. In addition to providing financial services, they also offer education information and assistance to help Muslims make informed decisions about their financial position.

The rapid expansion in Islamic finance is due to various reasons, including the increasing global Muslim population, the need for an alternative to traditional banking products and services and the rising awareness of the risks of financial transactions that are haram. Islamic finance is a rapidly expanding business and it is predicted to continue to grow over the next couple of years.

Credit cards What do they mean?

They are kind of payment card that allows the cardholder to take money from the issuer, usually an institution of finance or a bank with a set amount in order to purchase goods and take cash out. The money is then expected to be returned to the cardholder, along with any charges for interest.

They’re a kind of credits that are revolving. It allows the cardholder to charge up to a specific amount. If they are able to pay off their balances, then the limit is released to be re-used.

Credit cards are an excellent option to buy items from retailers that accept credit cards at both stores as well as online. They also allow withdrawing cash from ATMs. When a purchase is made and the cardholder is required to make a minimal monthly installment to issuer. This usually is in the form of a percentage of the amount. If the cardholder isn’t able to pay the minimum amount by when due, the card may be charged a late fee.

There are a variety of credit cards available, each with unique benefits, features, and conditions. Some credit cards have been created specifically for people who have good credit scores, while others are targeted at those with low credit, or no credit whatsoever. Furthermore, certain credit cards offer rewards such as cash back or points to purchase items using the card. Rewards can be used to purchase travel, products or credit on statements.

Although credit cards are a valuable and a convenient tool for financial use It is essential that the cardholders are accountable for their usage and make sure they are aware of the conditions of service as well as the limitations that are applicable to the card. Inappropriate use of credit cards can lead to massive debt that could negatively impact a person’s credit score.

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What are the basic principles of credit Cards Function?

Most people have an account with a debit or credit card these days. They’re great to make purchases from everyday necessities to unexpected expenses. How exactly do they work?

They are in essence loans which can be used to buy goods. When you buy something using credit cards, you’re borrowing money from the credit company. You’ll be required to repay the amount, as well as charges and interest over the course of a time.

Limits on credit are considered to be the maximum amount you’re allowed to be allowed to take out. It is set by the company that issues credit cards based on with a number of factors, including your credit score as well as your income. Credit utilization ratio which is a measure of how much credit you’re using in comparison to your credit limit will impact your credit score. Therefore, it’s important to keep the lowest credit utilization.

Paying on time for all bills are equally vital. Pay history is among the main aspects that affect your credit score. So, if you’re consistently making payments late, it can negatively impact your credit score.

If you’re able to use credit in a responsible manner, it can prove to be a powerful tool. It is essential to understand the basics of credit cards before making use of them. So, you can remain debt-free and won’t harm your credit score.

Are Credit Cards unconstitutional?

There’s a lot of debate about the question of whether transactions made with credit cards are legal or not. Some people believe credit cards legal however, some believe they’re not.

The reason that credit cards could be classified as haram is because of the rate of interest charged on them. In Islam it is not allowed to Islam the charging of charges of interest for credit card accounts and typically, they charge the highest rates of interest. If you have a due balance on your credit card, you could end up paying a large amount of money in interest.

Another reason why credit cards are thought to be illegal is because of the urge of spending far more that you’re capable of paying for. Credit cards make it simple to buy things, and If you’re not careful and take care, you could end up in financial debt. This could cause stress and anxiety and financial problems and anxiety, something Islam doesn’t allow.

There are numerous legitimate reasons why credit cards are illegal. It’s the consumer’s decision to determine if they would prefer to utilize credit cards. If you’re worried about the risk of having to cover interest as well as falling victim to becoming in financial debt, then you may prefer not to make use of credit cards. But, if you’re confident that you’re able to make smart use of them, there’s no reason not to benefit from the benefits they offer.

The Scholarly Oppositions on the subject of Credit Cards, First Group not permissible in the event that it involves any kind of riba

One group of students are firmly convinced that credit cards that have traditional features can’t be used because they are relying on the riba contract (even when you as the cardholder are planning to settle the amount in the full amount). We’ll give a brief summary of their argument in the following.

International Islamic Fiqh Academy

According to reports, it was reported that the International Islamic Fiqh Academy passed an Resolution (Number of 63/1/7) after studying various research papers regarding credit cards.Resolution . The International Islamic Fiqh Academy is generally of the view that if interest on usury is added to the amount borrowed the card is not admissible under Shariah. If the cardholder can pay the loan before interest is imposed on the loan amount that is due, a credit card that has interest charges is haram to Islam.


Sheikh Assim-al Hakkem responded to a question regarding the acceptance of credit cards in Islam and replied that generally, the use of credit cards are thought to be a prohibited transaction. If you’re a person who tends to spend on credit cards, you can purchase excessively with credit cards, and then end up with the payment of interest. This isn’t permitted. It is a grave offense in Islam.

2. The Second Group is permissible with specific conditions.

Another group of experts believe that using credit cards is ok when the cardholder can pay back the loan in a timely fashion and is not required any obligation of paying interest.

Here are some research-based conclusions that suggest that the use of credit cards in certain conditions is permitted. We found that many in the academics that classify credit cards which are traditional as acceptable under certain conditions, are in regions which do not provide Halal Islamic alternatives based on Islamic rules.

Two things to consider : In a simple way, if your residence is located situated in an Western country with little or no alternatives to halal and the necessary requirements for a credit card that is a traditional one and you are in the country of halal, then the scholarly perspective that we have discussed above will apply to your particular situation.

Western societies are characterized by agreements based on interest in all areas of our lives. We frequently travel and need to hire cars, or book hotel rooms which usually require the use of a credit card at moment of making the reservation. Based on the individual’s lifestyle, having no credit card may create an issue or obstruction.

Yasir Qadhi

Yasir Qadhi, who is an Islamic Imam, theologian, and preacher has provided a detailed answer to to the question What is the meaning of credit cards? as a form of Haram?

He explained that it was due to that the Assembly of Muslim Jurists of America (AMJA) as and his own belief that in case of urgent need for a cash, however not in a death-or-death scenario, then the person should apply for it. Only those who need credit cards are eligible to apply for one.

He said that the majority of people live a basic life, and don’t use credit cards for purchases of rent or food items and make use of their earnings to cover this. You can pay for these items using debit cards or an e-check.

Dr. Muhammad Salah

It is said that doctor. Muhammad Salah deemed the credit cards suitable for Muslims who live in non-Muslim nations that don’t have alternatives in credit cards which are Halal. He also stated that any person that is Muslim who wants to acquire credit cards should ensure that they do not put off paying the bill when they sign up to receive direct withdrawals from their account in order to ensure that they don’t miss the payment.

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Are you aware of or know of Islamic credit cards accessible?

Yes, you can find Islamic credit cards that conform to the principles in Islamic finance and conform to Shariah laws. The cards were designed in order to avoid charges for interest as well as other unlawful practices.

What are the alternatives to replace credit cards for Muslims?

Other options to credit card that is appropriate for Muslims include prepaid and debit card along with Islamic personal loans. The purpose of these loans is to avoid from the usage of interest, or other practices that are not permitted. It is suggested that you consult a reputable Islamic expert or financial adviser prior to applying for a loan or account.

Do I have the option of using the credit limit on my card in order to make a donation to charities or other reasons?

Yes, you’re allowed to make use of your credit cards to make donations to charities subject to being in conformity with Islamic financial principles. You can make the payment promptly and in full.


Conclusion even though credit cards aren’t inherently illegal, whether they’re permitted is dependent on the manner in which you make use of them. If you utilize them in a way that doesn’t cause an increase in debt, and conforms to Islamic principles and rules of finance they’re legal. But, it’s important to be aware of the of the risks and use these strategies with caution.

It is also important to be certain that your credit card company and the usage of the card are in line with Islamic financial rules. It is highly recommended to speak with a reputable Islamic expert or financial adviser prior to submitting on a credit card.

My personal experience is that it is recommended to steer away from these cards to minimize the chance of engaging in haram-related practices. It’s better to be safe instead of regretting. To avoid any financial difficulties that may occur and maintain a calm mind. Thank you for taking the time to read.

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Written By Alasad online Quran Tutor

QuranMualim Is an Islamic scholar and also an external consultant and author to Renewable Energy Maldives. He writes on Islamic financial issues as well as food and halal diet guidelines.

He is well-known within the Muslim community, well-known for his clear explanations of complex religious concepts. His invitations to speak at numerous gatherings and seminars on topics that relate to Islamic food as well as finance and renewable energy.

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