• EN (English)
Fatwa ID: 87581
Title: Paypal Halal?
Category: Financial Transactions
Scholar: Dr. Hatem al-Haj
Date: 10/13/2012

Question

Asalamu Alikum, I am the treasurer of the Muslim Student's Association at my college. We are looking to expand by accepting on-line donations inshAllah. I was wondering what method you would suggest for us. I am not sure if Paypal is entirely halal. They charge a transaction fee of 2.5% based on the amount donated to us. Is this a fixed riba?

I know credit cards are not considered halal by some scholars, so I am concerned that the money the people would be giving to us would be seen as a "loan" since it is not a cash-transaction and that we would be charged interest for it. If this is the case, do you have any other options or ideas for us that would be halal? Jazak Allah-Khier.


Answer

 

All praise be to Allah and may His blessings and peace be on His messenger, Muhammad,

Paying by credit card and paying through paypal are both halal. Having a credit card is halal in certain cases, but that is the responsibility of the card holder to verify that. For the merchant or recipient of donations, you may accept the credit card transactions. The percentage taken by paypal is not usury because they don’t loan you money, but provide you a service. Those fees are administrative fees.

Allah knows best.