Glossary
Hibah
A gift given freely, with nothing promised in return.
هبةhibah
Hibah is a voluntary transfer with no consideration. It matters far more on cards than its plainness suggests, because it is the legal route by which a bank can give you a benefit it could not sell you. Bank Negara's SAC ruled that personal accident takaful cover charged for through ujrah is not permissible but is permissible as hibah, and applied the same reasoning to a cash-back rebate on an annual fee. The catch for a consumer is that a gift, by definition, cannot be demanded.
Related terms
TakafulIslamic insurance, where members contribute to a shared pool that pays out to whoever suffers a loss.UjrahA fee or wage paid for a service done for you.Ibra'A rebate: the bank giving up part of what you owe, usually when you pay early.SadaqahVoluntary charity, given whenever you choose and in any amount.
Sources
- Bank Negara Malaysia, Shariah Resolutions in Islamic Finance, 2nd edition, items 91 and 92