Transferring money via paypal company
Fatwa No: 94389

  • Fatwa Date:3-4-2007 - Rabee' Al-Awwal 16, 1428
  • Rating:

Question

Assalamo Alaikom Wa Rahmat Allaah I sometimes use Paypal to receive money from other people as paypal offers fast mean of transfering money, but the unclear issue for me is that it states conditions for charge of their service which make me in dilemma whether it is halal or ribaa for example: If you receive £1 to £10 will incur say £ 0.5 charge for transfer. if you receive £11 to £100 will incur say £ 2.5 charge it is only imaginary figure to explain and the bigger the amount of money you receive the higher is the charge they put. is it halal and compliant with islamic shariah or is it Ribaa. Jazakom Allaah khairan assalamo Alaikom

Answer

All perfect praise be to Allaah, The Lord of the Worlds. I testify that there is none worthy of worship except Allaah, and that Muhammad  sallallaahu  `alayhi  wa  sallam ( may  Allaah exalt his mention ) is His slave and Messenger.

 

If you are inquiring about the ruling of the fees taken for transferring money and its difference according to the amount which one wants to transfer, then the answer is that the transfer of money which is known today in banks and exchange companies and the like, is a transfer of money or balance of an account from one bank account to another, or from one bank to another, or from one country to another, and the implications which may follow, like changing a local currency with a foreign currency, or a foreign currency with another foreign currency…etc.

Therefore, if the transfer is done by the same currency, then this work is an authorization in return for money, and authorization is permissible on the condition that the fee is known as in the case you mentioned in the question.

In case the transfer is done by another currency then this work involves an authorization and an exchange (of money from one currency to another), in this case, in addition to the condition which is mentioned in the first case, the handing over should be in the contract session, and the possession should either be actual from hand to hand, or virtual.

For more benefit on the conditions of exchanging money, please refer to Fataawa 87385 and 83372.  

Among the forms of virtual possession which are religiously considered, is the bank transfer which the Islamic Fiqh Academy considered, like the bank depositing an amount of money directly or by a remittance in the account of the customer, similarly if the bank withdraws an amount of money by the order of the customer from his own account for the benefit of another account in the same bank or other banks on behalf of the customer or any other beneficiary.

Allaah Knows best.

Related Fatwa