Category: Business Matters
Fatwa#: 39156
Asked Country: United Arab Emirates

Answered Date: Oct 06,2017

Title: Bank ‘‘Cash Back’’ Rewards

Question

Assalamu Alaykum 

I am working and living in Dubai nowadays. I am using credit cards from some banks here. Some cards have an feature that if you use them for certain amount (In my case 1000 dihams) at least than you will earn 2-4% cashback of the amount which you used. 

Is it permissible to use this cashbacks? 

If it is haram what I can do with the earned cashbacks which i used already? 

Assalamu alaykum rahmatullah

Answer

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

 

What is ‘‘Cash Back’’? [1]

Cash back can refer to two different kinds of card transactions:

1)    An option available to retail consumers when, during a debit card transaction, the customer can request to add an extra amount to the purchase price and receive the added amount in cash. Cash back using debit provides customers a convenient method of obtaining cash when purchasing goods and services without having to make a separate trip to an ATM or bank.

 

  2) A cardholder benefit offered by some credit card companies that pays the cardholder a small percentage of their net expenditures (purchases less refunds). Cash back benefits often provide the cardholder with the opportunity to choose from taking the cash, or using the "points" for purchases, travel (as with miles awards for air travel) or gift cards. Typically, cardholders must reach a certain points level to redeem for cash or other benefits. Some credit cards offer varying levels of cash back depending on the purchase. For example, a cardholder might earn 5% back on gas purchases, 2% on groceries and 1%on all other purchases.

 

It is permissible to use the ‘Cash Back’ Rewards. It falls in the category of Hibah (gift). [2]

 

And Allah Ta’āla Knows Best

 

Muhammad IV Patel

Student Darul Iftaa
Lusaka, Zambia 

Checked and Approved by,
Mufti Ebrahim Desai.

 



[2]  The Fiqhi status of rewards given by the credit card issuer is of a gift (Hibah). Such gifts are permissible. Therefore, it is permissible to earn rewards from card issuer and benefit from it. The reward could be in form of miles, cashback, discount etc.... Also getting special discounts as a member of certain credit card is also permissible.

The points earned on the credit card upon swiping a credit card is in essence an incentive and bonus from the credit card company, persuading the holder to increase his usage of the credit facility. It is similar to any other bonus or incentive one may receive. We do not find anything that is un-Islamic in these schemes that are offered.

If there are no other impermissible elements, such as gambling, interest, etc. then it would be permissible to accept such rewards and benefits.

 

See the answer below given by Mufti Taqi Uthmani Hafidhallah, a world-renowned Islamic legal scholar.

 

Rewards on Use of Credit Card

 

Q.) When using credit cards, some banks give bonus miles or bonus points for purchases and some other benefits. Please clarify it if we can use it. Every month I pay off the total of account without paying an extra cent of interest.

 

A.)    If a Credit Card is used for purchases and the bills are paid promptly without requiring to pay interest on late payment, it is permissible and the benefits given by the Credit Card Company as rewards can be availed of. It is not impermissible to benefit from such rewards.

 

اللباب في شرح الكتاب (ص: 219) 

الهبة تصح بالإيجاب والقبول، وتتم بالقبض، فإذا قبض الموهوب له في المجلس بغير أمر الواهب جاز، وإن قبض بعد الافتراق لم تصح، إلا أن يأذن له الواهب في القبض.     

    

        الجوهرة النيرة على مختصر القدوري (1/ 324)

الْهِبَةُ فِي اللُّغَةِ هِيَ التَّبَرُّعُ وَفِي الشَّرْعِ عِبَارَةٌ عَنْ تَمْلِيكِ الْأَعْيَانِ بِغَيْرِ عِوَضٍ وَهِيَ جَائِزَةٌ بِالْكِتَابِ وَهُوَ قَوْله تَعَالَى {فَإِنْ طِبْنَ لَكُمْ عَنْ شَيْءٍ مِنْهُ نَفْسًا فَكُلُوهُ هَنِيئًا مَرِيئًا} [النساء: 4] أَيْ هَنِيئًا لَا إثْمَ فِيهِ مَرِيئًا لَا مَلَامَةَ فِيهِ وَقِيلَ الْهَنِيءُ الطَّيِّبُ الْمَسَاغِ الَّذِي لَا يُنَغِّصُهُ شَيْءٌ وَالْمَرِيءُ الْمَحْمُودُ الْعَاقِبَةِ الَّذِي لَا يَضُرُّ وَلَا يُؤْذِي وَبِالسُّنَّةِ وَهُوَ قَوْلُهُ - عَلَيْهِ السَّلَامُ - «تَهَادَوْا تَحَابُّوا

الدر المختار وحاشية ابن عابدين (رد المحتار) (5/ 687)

لمناسبة ظاهر (هي) لغة: التفضل على الغير ولو غير مال. وشرعا: (تمليك العين مجانا) أي بلا عوض لا أن عدم العوض شرط فيه

وأما تمليك الدين من غير من عليه الدين فإن أمره بقبضه صحت لرجوعها إلى هبة العين

(وسببها إرادة الخير للواهب) دنيوي كعوض ومحبة وحسن ثناء، وأخروي: قال الإمام أبو منصور يجب على المؤمن أن يعلم ولده الجود والإحسان كما يجب عليه أن يعلمه التوحيد والإيمان؛ إذ حب الدنيا رأس كل خطيئة نهاية مندوبة وقبولها سنة قال - صلى الله عليه وسلم - «تهادوا تحابوا»

 

البحر الرائق - ث (7/ 284)

كِتَابُ الْهِبَةِ  هِيَ لُغَةً التَّفَضُّلُ على الْغَيْرِ بِمَا يَنْفَعُهُ وَلَوْ غير مَالٍ وَاصْطِلَاحًا ما أَشَارَ إلَيْهِ الْمُصَنِّفُ قَوْلُهُ ( هِيَ تَمْلِيكُ الْعَيْنِ بِلَا عِوَضٍ ) فَخَرَجَتْ الْإِبَاحَةُ وَالْعَارِيَّةُ وَالْإِجَارَةُ وَالْبَيْعُ وَهِبَةُ الدَّيْنِ مِمَّنْ عليه فإنه إسْقَاطٌ وَإِنْ كان بِلَفْظِ الْهِبَةِ

 

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