Interest charged on a cash withdrawal from a credit card

Q. I withdrew cash from my credit card and I was charged interest. I didn’t know that interest is charged if cash is withdrawn from a credit card. Will I be sinful? I bank with FNB. 

A. In accordance with the terms and conditions of using FNB’s credit facility, the following is stated:

Interest will be charged immediately from the transaction date for the following transactions, if the Credit facility is utilised to make these transactions:

* Cash withdrawals;

* Travellers cheque purchases with the Credit Card and certain forex transaction;

* Electronic funds transfers which result in a debit balance on your Credit Facility;

* All budget facility transactions and balance transfers;

* Fuel or fuel-related transactions on the Petro Card; and

* Any transaction whereby the Credit Card is not swiped at a point of sale device and considered to be a cash transaction.

As it is clear from the above, interest is charged immediately by withdrawing cash using the FNB credit facility.

In the inquired case, as you were not aware that interest is charged on a cash withdrawal using the FNB credit facility, you would be absolved of any sin. However, you should make a firm resolution not to make the same mistake in future.

Allah Ta’ala Knows Best

Mufti Ismaeel Bassa

themufti.com