Over the last years credit cards have developed in Germany as a popular payment instrument. As a client you can pay with it without cash in many restaurants, shops, petrol stations etc. both national and abroad. Especially for online shopping the credit card is of huge importance. It is also possible to get a credit card from an Islamic Bank. However, there are some conditions to consider in order to fulfil the Shari´ah compliance.

First, the credit card technically has to be some sort of "Charge Card". A "Charge Card" is a normal credit card where the client, after having paid with this card, monthly receives an invoice with all payments of the respective month. The total amount of the invoice will then be debited from the clients' current account. Technically, that means that the client gets an interest-free credit for the period as from the actual purchase until the monthly debiting from his current account. Depending on the individual creditworthiness, the Islamic Bank grants the respective client a credit limit. Up to this limit the client is allowed to effect the transactions monthly.

Opposite to these kinds of credit cards, the so-called revolving credit cards (which are quite common especially in the US and the UK) are not Shari´ah compliant. The concept of a revolving credit card is that a client also gets a credit limit depending on his individual creditworthiness. However, opposite to the above-mentioned Charge Card, the invoice amount is not debited from the current account of the client. Instead, the customer obtains an actual loan for the amount spent and a corresponding interest is charged to the client in this respect. The business with revolving credit cards is highly profitable for the traditional banks: interest rates of more than 20% a year are not uncommon. Because of the interest component and interest rates, that can be well termed as “usury”, the revolving credit card is not acceptable from a Shari´ah perspective.