Table of Contents
What Is An Islamic credit card?
An Islamic credit card, sometimes referred to as a credit card-i in Malaysia, is a financial product that abides by Shariah guidelines and is provided by Islamic financial institutions. These cards fill the demands of Muslim consumers looking for financial products that are in line with their beliefs and offer an alternative to traditional credit cards.
Definition of Islamic credit card
Islamic credit card are made to adhere to Islamic financial principles, which forbid charging or paying interest (riba) and encourage moral and ethical handling of money. When compared to standard credit cards, these cards offer a unique combination of features and perks while adhering to strict rules to ensure Shariah compliance.
Islamic credit card in Malaysia are subject to stringent rules to ensure compliance with Shariah law. The activities and products provided by Islamic financial institutions are governed by the principles of Shariah law as stated in the Quran, hadith, and sunnah. Shariah boards, made up of competent Islamic scholars who offer their judgements on the goods’ adherence to Shariah principles, evaluate and approve Islamic credit card.
The importance of understanding Islamic credit card
For Malaysian customers, especially those who prioritise Shariah compliance and look for financial solutions that are in line with their religious convictions, understanding Islamic credit card is essential. People can make educated selections and select the financial instruments that best suit their needs by being aware of the distinctive features and advantages of Islamic credit card.
Top Islamic Credit Card in Malaysia for 2023
Here is a comparison table highlighting the features, benefits, and drawbacks of the top Islamic credit card in Malaysia for 2023:
| Credit Card | Features | Benefits | Drawbacks |
| HSBC Amanah MPower Visa Platinum Credit Card-i | – Cashback
– Islamic |
– Up to 8% Cashback on eWallet, Petrol & Grocery Spend
– 0.2% Cashback on Other spend – 1% contribution on Charity spend – e-Commerce Purchase Protection (coverage up to USD200) -Islamic credit card |
– 8% Cashback requires total monthly spend of RM2,000 and above
– Cashback capped at RM15 per category per month |
| BSN 1 TeachersCard Mastercard | – Rewards / Offers
– Islamic – No Annual Payments |
– 1X Happy Points for every RM1 spent
– Finance Charge as low as 11% p.a – ZERO Annual Fee – FREE BSN Zing PLUSMiles Card – Up to RM500,000 travel insurance |
– Higher minimum income requirement
– Limited merchant acceptance |
| Bank Islam Visa Gold Credit Card-i | – Rewards / Offers
– Islamic |
– 1X TruReward Points for all retail spending
– Suitable for Halal spend – Islamic credit card – Card usage limited to Halal transactions only – FREE Takaful coverage |
– Higher minimum income requirement
– Limited merchant acceptance – Annual fee may apply |
| Bank Rakyat Credit Card-i Classic | – Rewards/ Offers
– Islamic – No Annual Payments |
– 1X Rakyat Reward Points for every RM10 spent
– Islamic credit card – ZERO Annual Fee – Card usage limited to Halal transactions only |
– Higher minimum income requirement
– Limited merchant acceptance |
| BSN Classic Credit Card-i Visa | – Rewards/ Offers
– Islamic – No Annual Payments – Travel |
– 1X Happy Points for every RM1 spent
– Islamic credit card – ZERO Annual Fee – FREE BSN Zing PLUSMiles Card – Up to RM300,000 travel insurance |
– Higher minimum income requirement
– Limited merchant acceptance |
| AmBank Islamic Visa Infinite | – Rewards / Offers
– No Annual Payments – Cashback – Islamic |
– 5X AmBonus Points for overseas spend
– 5X Plaza Premium Lounge Access – Club Marriott Malaysia Privileges – 1 FOR 1 Dining Deals – AMAZING 30 Campaign: Get AMAZING deals on your essentials Everyday – Golf Privileges: Complimentary Green Fees with 1 Paying Guest – ASEAN Duty Free Campaign: 10% Cashback from selected duty-free outlets – AmBonus Points not applicable for Online spend |
– Higher minimum income requirement
– Limited merchant acceptance |
How does a Malaysian Islamic credit card work?
Malaysians who want to take advantage of credit card convenience while adhering to Islamic financial principles have access to Islamic credit card, also known as credit card-i in that country. These cards are made to be Shariah-compliant, offering a different option from traditional credit cards while making sure that Islamic finance principles are followed.
An overview of how a Malaysian Islamic credit card functions is provided below:
- Shariah Compliance: Islamic credit card must adhere to Shariah and be devoid of practices that Muslims consider to be forbidden. The ban of gharar (overcharging) and riba (interest) distinguishes Islamic credit card from traditional credit cards as their key differences. Compound charges are not used on Islamic credit card since Shariah law forbids overcharging.
- Filtering System for Permissible Transactions: Islamic credit card have filters built in to make sure they can only be used for halal (allowed) transactions. This means that no purchases of alcohol, gambling, or other items that are prohibited by Islam may be made using the card. The card issuer will refuse the transaction if the card is used for such things.
- No Interest (Riba): Islamic credit card carefully avoid any interest fees since interest (riba), which is against Shariah law, is not allowed. Instead, Islamic banks charge a “profit charge” for their services in order to supply these cards. Only when an unpaid balance remains after the grace period does this fee become effective.
- Different Features and Benefits: In terms of daily usage, Islamic credit card are identical to traditional credit cards. They might, however, offer slightly different features and advantages. As an illustration, Islamic credit card may provide takaful coverage (Islamic insurance), early repayment discounts, and the choice to make zakat contributions.
It’s vital to remember that Muslims are not the only ones who can use Islamic credit card. Islamic credit card are an option for non-Muslims who prefer the idea of Islamic banking over traditional credit cards.
Advantages of Islamic credit card
In addition to meeting their unique religious requirements, Islamic credit card also provide benefits for users’ protection and ethical banking practices. The following are the main benefits of Islamic credit card:
-
Ethical banking principles
Islamic credit card follow Shariah regulations, which encourage moral and prudent financial behaviour. These values forbid engaging in haram economic deals as well as engaging in riba (interest) and gharar (uncertainty). Individuals can support a more moral banking system and ensure that their financial activities are in line with their religious convictions by using an Islamic credit card.
-
Catering to specific religious needs
Islamic credit card offer benefits for consumer protection that put the welfare of cardholders first. For instance:
- Filtering System: Islamic credit card have a filtration system built in to make sure that only halal (permissible) transactions are allowed. This feature stops the card from being used to make purchases related to gambling, drinking, or other activities that Islam considers to be forbidden. Such transactions will be rejected by the card issuer, giving cardholders peace of mind and preventing their money from being used for illegal purposes.
- Transparent Liability: Islamic credit card come with a built-in filtration system to ensure that only halal (permissible) transactions can be made. With the help of this feature, the card can no longer be used to make purchases connected to drinking, gambling, or other prohibited behaviours in Islam. The card issuer will refuse such transactions, providing cardholders with peace of mind and preventing the misuse of their money.
- Early Repayment Rebates: Some Islamic credit card offer early payback discounts to encourage customers to pay off their unpaid bills as soon as possible. These rebates offer financial advantages and promote prudent credit usage.
-
Consumer protection benefits
Islamic credit card are created expressly to meet the demands of Malaysian Muslims who practise their religion. These cards guarantee adherence to Shariah guidelines while offering a practical and accessible financial tool. Islamic credit card do not include interest (riba) charges, which are forbidden by Islamic law, therefore Muslim cardholders can access credit facilities without jeopardising their faith.
Additionally, Islamic credit card include advantages including cashback, rewards, airmiles, and other features found on regular credit cards. These extra benefits give cardholders a financial edge while upholding their dedication to moral banking.
In order to maintain adherence to Shariah principles and consumer safety, Islamic banking, including Islamic credit card, is strictly regulated in Malaysia. In order to ensure that Islamic financial products correspond to Islamic law, shariah boards made up of qualified Islamic scholars are essential in analysing and offering comments on them.
Malaysian customers can take advantage of credit card benefits while upholding their moral values and supporting ethical banking practises by using Islamic credit card.
**Looking for the most ethical and rewarding credit card options? Discover the best credit cards in Malaysia for 2023 on our informative page, “Best Credit Card in Malaysia 2023″.
