Glossary
Riba al-fadl
Getting more back than you gave when swapping two lots of the same thing, like trading one kilo of good dates for two kilos of poor ones.
ربا الفضلribā al-faḍl
This is the excess kind of riba: an unequal exchange of two quantities of the same class of commodity in a spot transaction. The classical list is gold, silver, wheat, barley, dates and salt. It matters for cards because money counts as one of these classes, so exchanging cash for cash at different values is riba al-fadl. Bank Negara Malaysia's Shariah Advisory Council used exactly that reasoning to rule out charging a fee for takaful cover on a card and to rule out a cash-back rebate on an annual fee: in both cases money was going one way and a different amount of money the other.
Related terms
RibaAny extra amount a lender gets back on top of what was lent, which Islamic law forbids.Riba al-nasi'ahThe extra you are charged simply for being given more time to pay.RibawiDescribes the categories of goods, such as gold, silver and money, whose exchange has to follow strict equal-and-immediate rules.
Sources
- Bank Negara Malaysia, Shariah Resolutions in Islamic Finance, 2nd edition, items 91 and 92