Iran introduces own credit cards

[robert99]

PressTV-Iran introduces own credit cards
Iranian banks to issue credit cards for first time
Iran has introduced credit cards for the first time in what appears to be a plan to encourage spending by the public.

The credit cards will be presented to applicants with three limits of Rials 100 million ($3,000), Rials 300 million ($10,000) and Rials 500 million ($15,000). They can be used for purchases in shops or online, the media reported.

The cards have been devised within Murabahah Islamic financing structure. Murabahah by definition involves the purchase of a commodity by the bank, on behalf of the customer, which is to be sold to the customer on a cost-plus-profit basis. The profit that the Central Bank of Iran (CBI) has devised for Iran’s Murabahah credit cards is 18 percent. The customers can repay the funds they receive through the cards in 36 installments.

Reports said only two banks – Bank Melli Iran and Ayandeh Bank– had started to issue credit cards.
(18% annual interest rate? Wall Street etc will be looking for some of that action!)

 

[robert99]

These are only possible after Obama's nuclear deal with Iran so Mastercard should send him a case of something good to drink. see MasterCards now available in Iran

 

[Second Summer]

Interesting. Loans with interest are generally considered haraam, so how does that work in this case?

Praise be to Allaah.
Loans from banks are of two types:
1. A “goodly loan” (qard hasan) which does not involve any additional payment (interest); there is nothing wrong with this;
2. A loan with interest, which is riba, and there is scholarly consensus that it is haraam. It is not permissible except in cases of urgent necessity which cannot be met except by taking out a riba-based loan.

More: Borrowing from the bank to buy a house - islamqa.info

Ah, I think I get it: It's the bank that purchases the product, and then sells the product to the person in 36 installments, incidentally at a price that is 18% higher. This is obviously totally different to interest.