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Service Charges for Depositing Coins

Answered according to Hanafi Fiqh by Darulifta Azaadville

Question:

1. Depositing coins in the bank is a challenging process due to the long lines, long wait, and bank charges. Owing to this, businesses have opened a facility where coins may be paid, saving a person the time of having to go to the bank. However, since the business now has to go to the bank to deposit the coins and pay the charges, etc., businesses are charging a fee for accepting coins.

It works like this. Every R100 paid in coins is reckoned as R95. (R5 is charged as a fee for accepting the cash.)

An example of this: Customer buys items worth R1000. He pays R1050 in coins for all the items, because R50 is taken as the fee for accepting the coins.

Two amounts are not stipulated from the onset, rather, a percentage of the value of the coins is taken. For instance: the customer is not told, “If you pay in notes, then R1000 and if you pay in coins, then R1050.” [I do not know if this will be permissible. Kindly answer this as well.] Rather, a 5% of the coins is taken as the fee. So the customer may pay R800 in notes and R210 in coins. [R10 to offset the fee of paying the R200 in coins.]

Is this permissible? Or is there any way to do such a transaction according to the Shariah?

Many Muslim businessmen are practicing this and say that they “heard” it is permissible. No Mufti’s name is given as support, however.

2. Can the seller stipulate 2 separate prices for cash and card? Example: If you pay cash, then R100. If you swipe your card, then R105. [Card: referring to normal debit cards]

 

The reason they do this is because they are charged by the bank for every swipe. Sometimes, they are making very little profit on the item. If they swipe, they will suffer a loss, instead of a gaining a profit on the item. 

Answer:

1. The manner in which the transaction is currently being facilitated, as well the manner suggested, both result in Riba (interest) and are therefore impermissible.

A permissible manner of facilitating this transaction would be to inform the customer in advance, that the purchase price of the item will be higher if the amount is paid using coins, and not to levy a separate charge for depositing the coins. The increase in the price of the item can be a fixed amount or a percentage of the item price, with the proviso that the customer is fully cognisant of, and agrees to the inflated price at the time of the sale being concluded. 

As far as the legal aspect is concerned, in terms of the Law, stipulation of different prices for different payment methods triggers a violation the CPA (Consumer Protection Act). Therein, it is stated that a supplier must not require a consumer to pay a price that is higher than the displayed price or, where more than one price is displayed for the same good/service, the supplier must not require the consumer to pay the higher of the two (or more) prices. Suppliers are required to display the price that the consumer will pay for goods/services when displaying goods/services for sale – “The price you see is the price you pay”. 

A possible way to achieve this without infringing on the law, would be to use a coin counting machine and charge the client for the service of counting and depositing the coins. The client could then be given a voucher equivalent to the value of the coins he deposited, allowing him to purchase items from the establishment.

2. Surcharging is the act of penalising a customer for using a card (whether debit or credit) to tender payment for goods and/or services i.e. A Merchant charges a card holder more than a cash-paying customer. Surcharging is a contravention of the CPA (as stated above), is prohibited in terms of the domestic card clearing rules, which are set by the Payments Association of South Africa (PASA), the Card Association Rules and in terms of the Merchant Services general terms and conditions, which form part of business banking merchant agreements. 

This restriction can be circumvented by stipulating a single item price and thereafter offering a discount to cash paying customers. 

In both the aforementioned situations, facilitating the transactions in a manner which contravenes the law could result in tarnishing the good name of Islam and Muslims, which does not behove a Muslim to do. We therefore advise that any implemented facility be in accordance with the laws and regulations.

Checked and Approved By:

Mufti Muhammed Saeed Motara Saheb D.B.

منها في العقد وهو موافقة القبول للإيجاب بأن يقبل المشتري ما أوجبه البائع بما أوجبه فإن خالفه بأن قبل غير ما أوجبه أو بعض ما أوجبه أو بغير ما أوجبه أو ببعض ما أوجبه لم ينعقد إلا فيما إذا كان الإيجاب من المشتري فقبل البائع بأنقص من الثمن أو كان من البائع فقبل المشتري بأزيد انعقد فإن قبل البائع الزيادة في المجلس جازت، كذا في البحر الرائق

(الفتاوى الهندية 2/3)

ومنها أن يكون المبيع معلوما والثمن معلوما علما يمنع من المنازعة فبيع المجهول جهالة تفضي إليها غير صحيح كبيع شاة من هذا القطيع وبيع شيء بقيمته وبحكم فلان
(الفتاوى الهندية
3/3)

http://www.pasa.org.za/about-payments/faq

https://www.gov.za/sites/default/files/gcis_document/201409/321864670.pdf -Page 64/Section 23.(6) 

 

This answer was collected from the official Ifta website of Darul Uloom Azaadville, South Africa. Most of the answers are checked and approved by Mufti Muhammed Saeed Motara Saheb D.B.

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