Is it permissible to use a prepaid Visa card with a percentage-based purchase fee (3.5%), along with a cancellation penalty, when its alternative requires a fixed shipping fee?

The answer is summarized in the following points:

Firstly: There is no objection to using a prepaid (covered) Visa card, nor to paying fees for it, because these are charges for issuance, renewal, or enablement of use, and not a loan.

Secondly: Regarding the bank’s taking a percentage of the amount as a fee when the card is used for purchases or withdrawals, there is a difference of opinion among jurists. The majority disallowed it due to uncertainty (jahalah), while the Hanbalis, Zahiris, and some Hanafis and Malikis permitted it by analogy with musaqat (sharecropping of trees) and muzara’ah (sharecropping of crops). The preponderant view is permissibility due to the strength of the Hanbali argumentation, in addition to the fact that the percentage in this case is known at the time of the contract.

Thirdly: If the card is not covered, it is considered a loan from the bank to the customer. Therefore, the bank is not permitted to take more than the actual cost in fees, nor is it permitted to take a percentage, because any stipulated increase in a loan is usury (riba).

Fourthly: It is permissible to deal with a card for which a fixed amount is paid with each top-up (approximately 10 Euros), as this is a fee for enabling the use of the card.

Conclusion: There is no objection to dealing with the card mentioned in the question or the second card.