My friend is a travel agent and he books air tickets

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Question

Dear Hazrat,

My friend is a travel agent and he books air tickets. He accept cash and credit card from customers for making payments.
He has installed a credit card swiping machine from a bank which is used for accepting credit card payments.
Bank usually charges around 3% for processing credit card payments.
As he has cash available so, nowadays, he is giving cash on credit card to people who want cash after swiping credit card.
Because in India, we can buy goods using credit card but if we withdraw cash using credit card, high rate of interest is charged and we can only withdraw cash upto 10% of credit card limit.
My friend usually charge around 5% of the amount from the people who want cash against their credit card. As bank usually charge 3% , the remaining 2% of the amount is my friends profit.
I would like to know is this allowed as per islamic law?

Answer

Muhtaram / Muhtaramah

In the Name of Allāh, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāh wa-barakātuh.

According to our understanding if a person wants Rs 1000 in cash he swipes his credit card at the travel agent and he agent would in turn advance the Rs 1000 cash and charge a 5% fee for this type of service.

If our understanding is correct, such a type of service is not permissible as the 2% “profit” received by the travel agent is interest.

And Allah knows best
Darul Iftaa

Madrasah Inaa’miyyah

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