Glossary
Ujrah
A fee or wage paid for a service done for you.
أجرةujrah
Ujrah is the payment side of a hire or service contract. On Islamic cards it is the most common alternative to interest: the bank charges a fee for providing the card and its services rather than a charge on the money owed. Bank Negara Malaysia's SAC approved ujrah-based cards in 2008 on four conditions, the sharpest being that ujrah may not be charged for the loan itself, for deferring the debt, or for exchanging cash at a different value, and that the fee must be a fixed amount not tied to the credit limit.
This is also a card contract structure
The bank charges you a fixed fee for the service of giving you a card, rather than a charge that grows with the money you owe.
How Ujrah works on a credit cardRelated terms
IjarahA lease: renting the use of something, or someone's services, for a fee.Ta'widhCompensation for money the bank actually lost because you paid late.RibaAny extra amount a lender gets back on top of what was lent, which Islamic law forbids.HibahA gift given freely, with nothing promised in return.
Sources
- Bank Negara Malaysia, Shariah Resolutions in Islamic Finance, 2nd edition, items 90 and 93