Answer
In the Name of Allah, Most Gracious, Most Merciful.
All praise and thanks are due to Allah, and peace and blessings be upon His Messenger.
In this fatwa:
Working for companies that issue interest-based credit cards or cards with invalid conditions is not permissible according to Shari’ah. It’s essential for Muslims to carefully understand the terms and conditions of any credit card they consider using or working with to ensure compliance with Islamic principles.
Answering your question, The Assembly of Muslim Jurists of America, states:
Credit Cards and Their Importance
Credit cards are of the utmost importance in this day and age, because they take the place of hard currency, making it unnecessary to carry cash or to store it. As such, they have become a necessity and it is almost impossible to do without them, especially outside the lands of Islam.
Types of Credit Cards and Their Shari`ah Compliance
Credit cards are of two types:
- Debit cards covered by the holder’s cash balance in return for which the issuer is entitled to take a fixed fee; this compensation is legitimate in Shari`ah, because the charge for using it is deducted from the holder’s balance. As such, it is permissible to use these cards. Likewise, it is permissible to manufacture them, to work for companies issuing them or to be involved in marketing them.
- Credit cards not covered by the holder’s cash balance. These are of three types:
- A credit card issued in exchange for a fixed fee: This is a means of making purchases with borrowed money, with a specific plan for repayment, without any extra charge for late payment. These cards are issued by Islamic financial institutions; they do not exist at any other institutions as far as we know outside the lands of Islam. These are permissible in Shari`ah, so it is permissible to use them. It is likewise permissible to manufacture them, to issue them, to work for companies that issue them and to market them.
- Interest-based credit cards: These are a means for making purchases with borrowed money and there is interest charged on the loan. These are prohibited in Shari`ah and, as such, it is not permissible to manufacture them, to issue them, to work for companies that issue them or to market them.
- Cards that grant the holder a specified grace period within which no interest will be charged. If one is late in paying, however, after the term has expired, interest will be charged. This is not permissible because the contract contains an invalid condition.
As such, it is not permissible to manufacture them, to issue them, to work for companies that issue them or to market them. Exemption is made for those with special needs to deal with the third type, under condition of dire necessity (that which would make a person’s life extremely difficult), pervasive affliction (that the prohibited thing is so widespread that it is difficult for an accountable person to avoid it) and complete lack of alternatives.
One would be obliged to repay the amount in full before the grace period expires and, therefore, before interest would be charged. One must also be able to assert, with confidence, that he/she will more than likely be capable of doing that.
Working for Credit Card Companies
Concerning work in the field of manufacturing, issuing or marketing cards that do not meet the requirements of Shari`ah, the ruling would remain as is: prohibition. That is because the license to use something in cases of exigent need or dire necessity would not apply to work in manufacturing or marketing, unless [the worker himself is] in a case of exigent need.
Almighty Allah knows best.
Source: AMJA Online