Annual Fee for Credit Cards
Question
Is it permissible to pay an annual fee for the service of having a credit card? Sometimes this may result in certain rewards.
بسم الله الرحمن الرحیم
Answer
It is permissible to pay an annual fee for the service of having a credit card. The annual fee is charged by the credit card company in exchange of the services it provides. It is for this reason that the fee is fixed irrespective of whether the credit card is used or not and the extent to which it is used. This demonstrates that it is not interest. In so far as rewards and incentives are concerned, they will be treated as gifts as outlined in an earlier answer.
Allah knows best
Yusuf Shabbir
19 Muḥarram 1441 / 19 September 2019
Approved by: Mufti Shabbir Ahmad and Mufti Muhammad Tahir