SS 61 · Cards and banking services

SS 61: Payment Cards

What this standard is about

Payment cards are part of daily life, and Muslims need to know which card structures are allowed. This standard covers four card types issued by banks: debit cards, prepaid cards, charge cards (paid in full each period), and credit cards (revolving). It replaces the earlier cards standard, SS 2.

Five parties take part in a card transaction: the issuing bank, the cardholder, the merchant, the merchant's bank (acquirer), and the card network. The standard explains the Shariah character of each relationship and the rules for each card type.

Why it exists

Conventional credit cards run on interest: balances revolve month to month and interest piles up. That is riba, and it is forbidden. But cards are also practical necessities. The standard shows how each card type can work within Islamic rules, including a Shariah-compliant credit card built on a benevolent loan, and it sets limits on fees so banks cannot smuggle interest back in through charges.

The key rules, simply put

A debit card spends the holder's own balance. It is allowed, and it may not be used to overdraw against interest.
A prepaid card spends a pre-loaded balance. It is allowed, and converting its balance between currencies must follow spot exchange (sarf) rules.
A charge card gives short-term credit that must be repaid in full each period. It is allowed, but the bank may not charge interest on late payment.
A revolving credit card, where balances carry forward with interest, is not allowed.
A Shariah-compliant credit card works as a benevolent loan (qard hasan): the holder repays only the principal in installments, and the bank charges only fees that cover its actual direct costs.
Fees on lending cards must not exceed the bank's actual costs of issuance, renewal, withdrawals, and currency exchange. Fees on non-lending cards follow the agreement between the parties.
Cards may not be used for forbidden purposes. The bank may cancel cards that are misused.
Rewards such as cashback, discounts, and air miles are allowed when Shariah-compliant. Forbidden perks, such as conventional insurance or gifts linked to prohibited activities, are not.

An everyday example

An Islamic bank issues a credit card structured as qard hasan. The customer spends $2,000, repays $2,000 in monthly installments, and pays a fixed annual fee that covers the bank's actual card costs. No interest is ever charged, even if a payment is late. This follows the standard.

Words to know

Qard hasan — a benevolent loan; the borrower repays only the principal, with no extra charge.
Riba — interest; any guaranteed extra charged on a loan. Forbidden in Islam.
Sarf — currency exchange, which must be completed on the spot.
Takaful — Islamic insurance based on mutual contribution.
Hawalah — transfer of a payment obligation from one party to another.

Source

AAOIFI announcement: Shariah Standard on Payment Cards (SS 61) approved and issued — https://aaoifi.com/announcement/aaoifi-shariah-board-approves-and-issues-shariah-standard-payment-cards/?lang=en
AAOIFI exposure draft citing SS 61 clauses 5/1/1 and 5/2 (fee rules) — https://aaoifi.com/wp-content/uploads/2025/12/ED-of-FAS-__-Direct-Costs-Determination-Attribution-and-Reimbursement.pdf (no free full text of the standard is published; AAOIFI sells the complete text)