ISLAMIC CREDIT CARD HALAL CREDIT CARD SHARIAH COMPLIANT BANK CARD بطاقة ائتمان إسلامية

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Islamic Credit Card gives you access to an Islamic Credit Card online. Thanks to Islamiccreditcard.com you will be able to understand the principles and structures of islamic credit cards.

Islamic Credit Cards are free from any Riba or Gharar. Riba consisting of interest and Gharar as uncertainty. One of the Islamic credit card principles us to avoid that people live beyond their means which is the case with a conventional credit card

DEFINITION OF AN ISLAMIC CREDIT CARD

The Islamic credit card is defined as a means of electronic payment including a deferred payment respecting the principles of Islamic law and guided by the rules of Islamic finance which bans any interest-bearing revolving credit facility .

IMPORTANCE OF ISLAMIC CREDIT CARD TO MUSLIMS

Islamic finance today offers more and more sophisticated financial instruments affecting positively the field of payment for individuals as well.

Payment by credit card to meet the rules of Islamic finance was lacking until just recently and its birth will greatly influence the credit card market especially in the Muslim world.

Islamic credit cards are becoming an important global payment tool which enjoys high acceptance worldwide allowing to the user of the halal card to comply with the principles of the Islamic Sharia.

WHAT DIFFERENTIATES A CONVENTIONAL (HARAM) CREDIT CARD FROM A HALAL CREDIT CARD?

The difference between the conventional credit card and the Islamic credit card shows clearly what seperates the use of a universal payment method and an ethical credit card.

The differences between conventional and Islamic credit cards are mainly :

• No money lending: since the transaction of credit card is based on trade (Bai'), the element of usury will be eliminated from the loan transaction that is applied in the conventional money lending.
• No compounding of profits: profit margin for the cardholders is fixed for the whole period (between 35 and 60 months) and the profit is charged based on the remaining balance. The profit is calculated on a monthly basis, based on a outstanding due or monthly total transactions.
• Control on transactions/merchants: islamic credit card users are allowed to carry out only halal, or shariah compliant transactions. Declined are transactions for six categories of non-halal related activities, including bars, discos, night clubs and gambling.
• The choice of the mode of payment is conditioned by an ethical and religious attitude.
• The behavior of the islamic credit card user will be different from the one who is holding a classical credit card as he would not be able to live above his means.
• Restrictions given wth the islamic cards are based on an ethical approach while conventional cards allow to use the card for any purchse of product and services including gambling.
• Globally spoken, a significant difference between the two cards is that the islamic card provides with a better protection against major financial finance crisis finance because of a strict and severe restriction as to speculation and over-indebtedness.

DISADVANTAGE OF THE CONVENTIONAL CREDIT CARD FOR THE MUSLIM

Practical in appearance while offering flexibility to its user, the conventional credit card provides with inconveniences after analyzing its financial and ethical repercussions:

• Applied interest rates are often usurious.
• These cards encourage to spend more than user perceives as income and motivate impulse spending, consumerism and debt proliferation.
• The card is often used as a short-term loan when banks refuse a conventional credit facility or an overdraft.
• This card is often used to finance the debts of other credit cards without the transactions being underlined by tangible assets.
• The card can be used for the purchase of all products and services including those harmful to the human being, whether it is gambling or alcohol.

ADVANTAGES OF AN ISLAMIC CREDIT CARD

The Islamic credit card offers many advantages for the Muslim who wishes to respect the principles of Islamic Sharia:

• Islamic credit card doesn’t allow the element of usury (high interest rates).
• Motivates the customers to proceed with early repayment offering him incentives such as rebates.
• The bank issuing the payment card does not offer speculative financial products and does not invest in sectors that are not accepted by the Sharia.
• The Islamic card can only be used for operations that are underlines through tangible assets.
• The halal credit card cannot be used to buy products and services that are not conform with the Islamic Sharia.
• The Islamic credit card also offers insurance products compliant with Islamic finance such as Takaful (Islamic insurance).
• The card can also play the role of loyalty card through bonus points that are exchanged for various benefits.

FINANCIAL PRODUCTS INSIDE AN ISLAMIC CREDIT CARD

Using an Islamic credit card is not only obtaining access to sharia compliant financing services, the card holder enjoys also other Islamic finance compliant products such as islamic insurance products.

Complimentary Takaful (Islamic insurance) protection applies when using a halal credit card not only while travelling, but some banks add an additional product to cover the family of the card user in case of permanent disability or death, that clears off all the outstanding balance.

HOW DOES AN ISLAMIC CREDIT CARD WORK: PRINCIPLES AND MECHANISMS

The structure of Islamic credit cards is certainly complex compared to a conventional credit card, as their mechanism is in accordance with the Islamic Sharia.

TYPES OF ISLAMIC CREDIT CARDS

There are many types of Islamic credit cards respecting the principles of Islamic Sharia:

• Islamic charge card or halal prepaid credit card.
• Qard Al-hasan credit card.
• Bay Al-Inah credit Card.
• Tawarruq credit card.
• Murabahah credit card.

ISLAMIC CREDIT CARD FOR TRAVELLING

A travel islamic credit card is by definition a halal payment card used by a Muslim user for his travels in his country and abroad while respecting the laws of Islamic finance for his purchases in overseas.

The islamic credit card for travel is used by Muslims who travel either on holidays within private trips or for work on business trips and who wish to apply the rules of Islamic Shariah.

While travelling, the Islamic credit card is very important for the Muslim traveller, not only to enable him to have the ability to spend money without in having cash, moreover the islamic travel card must allow him to access to the following benefits:

• Travel islamic travel insurance or travel Takaful (health, repatriation, death, accident).
• Travel miles.
• Emergency assistance services.
• Hotel discount.
• Airport lounge access.

The best travel Islamic credit card will be however chosen by the Muslim who travels based on an important criteria. This main criteria is to be provided with good insurances he should rely on, particularly when the user of the halal card faces an emergency situation when he is abroad.

HOW TO COMPARE ISLAMIC CREDIT CARDS ?

Comparing islamic credit cards is crucial.The islamic credit card comparison objective is to find the best islamic Shariah compliant credit card that is to be used by a Muslim who wishes to respect the principles of Islamic finance.

The comparison between Islamic credit cards is important for the Muslim user because of the large number of halal credit card providers and the great competition that exists between among the different Shariah compliant payment card issuers.

Comparing an Islamic credit card with another halal payment card and in order to be efficient, a Muslim car user should evaluate all the important criteria that will contribute to the decision to take a halal card.

The comparison of a Islamic credit card with another will essentially rely on the following criteria:

• Profit rate.
• Cash back.
• Balance transfer.
• Annual fee.
• Family Takaful (Islamic insurance cover).
• Air Miles conversion.
• Discount on dining and hotel.
• Airport lounge access.

An islamic credit card comparison is based not only on the criteria mentioned above, but the most important criteria for choosing the best Islamic credit card is the quality of service provided by the card issuer as well as the permanent accessibility to the card services, particularly in case of emergency.

ISLAMIC CREDIT CARD: COUNTRIES OFFERING HALAL CREDIT CARDS