Fatwa ID: 08170

Answered by:
Mawlana Muhammad Zubair Khan Alizai

Question:

السلام عليكم ورحمة الله وبركاته

Trust you are well.

Can you brief me on the Islamic ruling for the below?

One of my very closest friends would like to ask that he has borrowed money from one of his friends and he would like to pay it off, but unfortunately, he has not got enough money and he was asking me if I could help him.

I advised him that he should borrow the money from the bank interest-free credit card balance transfer. I’m sure you are familiar with these cards, how they work I have attached an example for you.

As per my understanding, the bank gives you a certain amount of interest-free money on the card over 18 months or 24 months. You can use this money to pay your purchases and also you can balance transfer to your existing current account, but they would charge a minimum fee of between 3 to 4% of the total money borrowed.

You have to pay off within 18 or 24 months the full balance, else the bank will charge interest on the owing amount.

The bank also requires that one can pay the minimum amount monthly over the period.

Is it permissible to get a few cards from different banks and before the time expires, he would pay off the total money he borrowed? Hence, interest will not occur. Only the extra money he’s paying is the fee when he does the balance transfer to his current account.

Please let me know the ruling.

In the name of Allah, the Most Gracious, the Most Merciful

Answer:

وعليكم السلام ورحمة الله وبركاته

A ‘0% APR’ or ‘interest-free’ credit card gives you a window where you can borrow money without paying interest, often for an introductory period.

This means that you can spread the cost of purchases over several months, without paying any interest on top.

Remember, you’ll need to keep up with your monthly repayments, and make sure any purchases are paid off in full before the end of the 0% period to avoid paying interest on them.

Once this offer period has ended, any remaining balance will start earning interest until you’ve made a full payment to clear the statement balance.

This would be a viable option if you are certain that you are able to pay it off within the time limit that is given by the bank. Otherwise, if there is a fear of not being able to pay it off within the time limit and having to pay interest on top, then it wouldn’t be permissible.

Another option which I believe would be the best option is to borrow the money from family or friends as what we call “Qardh e Hasanah”, a good loan where there is absolutely no fear of interest.

And only Allah Ta’ala knows best.

Written by:
Mawlana Muhammad Zubair Khan Alizai

Checked and approved by:
Mufti Mohammed Tosir Miah

Darul Ifta Birmingham