New credit card follows Sharia law

Posted on 19. Apr, 2010 by David White in Biz/Tech

JANE SPONAGLE
BIZ/TECH REPORTER

Humber is happy to accept tuition payments from the iFreedom Plus MasterCard, the first prepaid credit card in Canada marketed to the Muslim community.
Sanjay Puri the director of financial services and planning said the card might even be better than regular credit cards.
As the card is prepaid, Puri said, “the chances of it ever going wrong are nil.”
Traditional credit cards violate Sharia law where it is prohibited to pay or accept interest fees attached to borrowing or lending money.
Clients can sign up online for the pre-paid card, said Sikander Hashmi, vice-president of UM Financial, an Canadian Islamic financial institution that offers financial services which abides with Sharia law.
After the card arrives in the mail, clients can load funds onto the card through their bank account by logging into their online account.
“Your credit limit is basically what you have on your card. The maximum you can have at any one time is $6,000. The most you can load at one time is $3,000,” said Hashmi.
He said the card doesn’t have monthly maintenance or point of sales fees, but there are still fees attached to the card, like a $0.95 fee to transfer money from  a bank account to the card and for withdrawing money at an ATM.
There is a strong demand in the Muslim community for Islamic financial products, he said.
“The Muslim community in Canada is close to a million and there’s projections that it will probably hit 1.5 million in a few years, so there’s a considerable market out there.”
Hashmi said it’s estimated that Islamic financial products are a $500 billion to a $1 trillion global industry.
“We had an Ipsos-Reid survey done for us that showed that approximately 50 per cent of the Muslim community would go for halal or Sharia compliant products.”
First-year mechanical engineering student Usama Saeed, 20, said he would need to see more authenticity from religious scholars before deciding to sign up for the card.
“In terms of progress, I think it’s a very good idea.  Somebody’s coming up to do something for a group of people,” said Saeed.