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Is the banking transaction that allows an overdraft facility up to a maximum of 500 Euros, and entails the bank taking 1.5 Euros when the amount is settled from the monthly salary, considered permissible (halal) or usury (riba)?

1 min readAlso available in العربية

There is no harm in borrowing through a credit card if the increase taken by the lending bank or post office is within the actual cost of the withdrawal process, and does not include a penalty clause for late payment. However, if the increase exceeds the actual cost, or the condition includes a late payment penalty, then borrowing with it is not permissible. It must be noted that opening a current account in an interest-based bank is only permissible under two conditions: the absence of an Islamic bank, and the fear of theft or loss of money.

Summarized from the full answer at Ftawy · reviewed Sep 2, 2026

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