Hi,

Would any of you apply for a Islamic Credit Card ?

If so, which bank would you most likely to apply ?

What are the key features that attract your attention towards Islamic Credit Card?

Well, most Islamic financial products offered locally do have some form of "riba". Though most would phrase it differently in their respective Terms & Conditions, at the end of the day, it amounts to the same, albeit a different name.

However, I do notice that some banks, not all, do follow a strict adherence to certain Islamic law, and build these adherence into their products.

One of these features, is the non-compounding interest. Though seems insignificant at a glance, may accumulate to sizeable amount if your outstanding card balance is huge and you're paying the minimum repayment.

Hmm.. I'm not so sure about that, the part where you can't use it in non-halal places. However, I think that the Terms and Conditions may mention it somewhere. And I supposed most muslim would abide by that.

My curiosity is actually towards non-muslim. I mean, most of us here have a credit card. It's just that Islamic credit card seemed to have this.... stigma... or rather, stereotypical perception that it is somehow Islamic related though feature wise, it's not that much different.

I'm actually contemplating getting one but just wondering what are the thoughts among most non-muslim, in terms of perception.

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Added on May 2, 2009, 2:31 amOut of curiosity, you mentioned "better" in what sense? issit the lower interest rate due to non-compounding interest? Is that the only key feature or is there something else? Any reward points or rebate with Bank Islam C.C.?

This post has been edited by barra: May 2 2009, 02:31 AM

Anyone got a HSBC or CIMB islamic card. The last I checked, they have got a "Management Fee", quite hefty. Not sure what that fee is.

If anyone got HSBC or CIMB islamic card, care to share your usage experience?

what about Maybank Islamic card, anyone here owns one? Is there a "Management Fee"?

I've done a bit of research myself, though I'm not using any Islamic card atm, having many other cards already. Just been comtemplating whether I should actually get one.

Now here's what I found:

The number ONE benefit on Islamic card is this:

Non-Compounding Interest. Meaning, you don't pay interest on interest.
Here's a rough calculation, for simplicity purposes, let's assume you never pay minimum at all payment, as an example

Outstanding balance: 10,000, Interest 17.5%p.a. OR 1.45%p.m., No repayment

Conventional Credit Card Calculation (NOB = New Outstanding Balance)
1st month interest (based on 10,000)= 145.83, NOB: 10145.83
2nd month interest (based on 10145.83)= 147.96, NOB: 10293.79
3rd month interest (based on 10293.79)= 150.11, NOB: 10443.9

Islamic Credit Card Calculation
1st month interest (based on 10,000)= 145.83, NOB: 10145.83
2nd month interest (based on 10,000)= 145.83, NOB: 10291.66
3rd month interest (based on 10,000)= 145.83, NOB: 10437.49

Difference after 3 months: RM6.30

Bare in mind that although this is a very rough calculation, based on Monthly, not Daily (actual calculation, which I don't have formula) interest, you can see the savings. Plus, actual interest calculated on daily basis is actually 19%++ p.a., not the usual 17.5% as you see on the brochure or Terms and Conditions.


Now let's do a minimum payment of 10% per month !
Outstanding balance: 10,000, Interest 17.5%p.a. OR 1.45%p.m., Repayment: 10% of total outstanding balance

Conventional Credit Card Calculation
1st month interest (based on 10,000)= 145.83, NOB: 10145.83, repayment 1014.58, NOB after repayment=9131.247
2nd month interest (based on 9131.247)= 133.16, NOB: 9264.41, repayment 926.44, NOB after repayment= 8337.97
3rd month interest (based on 8337.97)= 121.59, NOB: 8459.56

Islamic Credit Card Calculation
1st month interest (based on 10,000)= 145.83, NOB: 10145.83, repayment 1014.58, NOB after repayment=9131.247
2nd month interest (based on 9131.24-145.83=8985.417)= 131.03, NOB: 9262.27, repayment 926.22, NOB after repayment= 8336.05
3rd month interest (based on 8336.05-131.03=8205.02)= 119.65, NOB: 8455.70

Difference after 3 months: RM3.86

Other features, which makes no difference to me if I'm not a Muslim, is that you can do Sedakah (Donation) via your Islamic card.
There's also Umrah packages when you can to go for your pilgrimage.

I know Bank Islam and Maybank do offer Sedakah facility and also Umrah packages. But really, at the end of the day, it's the non-compounding interest that makes the key difference between Islamic and Conventional Card.

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Added on May 5, 2009, 12:21 amEr.. nope I don't think Islamic card applies to Muslim only. Anyone can apply. Cause if not, the brochure or Terms and Cond will state otherwise, so far, I've never come across that.

Now, see my reply above, we do save some amount compare to conventional card. However, the amount maybe insignificant if you clear your card monthly. It is only obvious when you do 5% minimum repayment monthly (then swipe even more the next month!).

Another obvious benefit, if you apply for Maybank Islamic card, is Treats Points. Get the Amex Islamic card and you'll get 2X Treats Points on ALL TRANSACTION, compare to PETRONAS only 5X points on Petrol transaction (and you can pump only so much). Maybank also occasionally gives out 5X Treats Points, and as of now until July, Amex is giving 8X Points !!

This post has been edited by barra: May 5 2009, 12:21 AM

bummer... this poll is really taking off at snails pace... or slower.....

With the new RM50 Service Tax to be implemented in 2010, anyone here keeping their Islamic Card??