Credit Card: Life Rope or Noose?

My dear brothers and sisters in Islam,

Last few days ago, I bought a new 'Forward' magazine for this month, November 2008 (vol.29). I think the topics being discussed in this edition are very interesting for us to know especially the issues that related to our daily life such as credit card issue. "Credit card – life rope or noose" is a favorite topic for me to read. Therefore, I would like to encourage you to buy and read this magazine so that you can get some beneficial information about the advantages and disadvantages of using credit cards.

First of all, the writer said: "It was a bit surprising to hear Mohamed Akwal Sultan, the Chief Executive Officer of Credit Counseling and Dept Management Agency (AKPK) that they actually want people to use credit cards. This is a bit strange because AKPK was set up by central Bank Negara Malaysia (BNM) to help the public to assist them in getting out of dept through counseling and dept management programmes."

"With RM23.3 billion of household debt derived from credit cards depts., it is puzzling why AKPK would like to promote the usage of credit cards. Aren't they supposed to be curbing them and teaching the people to snip their credit cards into pieces?" He added. Actually, I strongly agree with the writer's argument regarding this issue. Why AKPK should encourage people to use credit cards? This is far away from their jobs. What they should do is to advise people and create awareness for them to avoid using credit cards so that they could fly away from debts' problems.

For me, there are many disadvantages of using credit cards compared to its advantages because:

1) Credit cards encourage people to debt and spend their money extravagantly. Please read verse 27, surah Al-Isra' Allah S.W.T. said: "Verily, the spendthrifts are brothers of the Syaitan (devils), and Syaitan is ever ungrateful to his Lord."

2) It encourages people to involve in Riba that has been forbidden by Allah S.W.T. because if somebody pays only the minimum then the credit card company really likes him, because the bank can charge interest. It is about 1.5 percent a month, compounded it is about 20 percent per annum. "Those who eat Riba (usury) will not stand (on the Day of Resurrection) except like the standing of a person beaten by Syaitan (Satan), leading him to insanity. That is because they say: "Trading is only like Riba" Whereas Allah has permitted trading and forbidden Riba. So, whosoever receives an admonition from his Lord and stops eating Riba shall not be punished for the past; his case is for Allah (to judge); but whoever returns [to Riba], such are the dwellers of the Fire-they will abide therein." [Al-Baqarah: 275]

3) People who use the credit cards are difficult to donate their money to the needy, when asked for help, people in this group spent less time helping.

Please read more about this issue in this magazine from page 25 to 43. For me, credit card is "Life rope or noose." Please don’t use and avoid it.