As-Salāmu ʿalaykum Mufti,
in Germany you can buy products in shops with a 0% financing rate through a bank mediated by the company. You sign a purchase agreement with the company and sign the loan agreement at the same time without meeting the bank in person.
1. Would such an indirect contract be permissible, i.e. would a bank mandate to the company suffice? Can you give general fiqhi guidance on three-party agreements? What do you have to consider?
2. Would such a financing loan be allowed if you are sure that you will pay the monthly amount on time and thus avoid the penalty interest mentioned in the contract?
3. Some banks require to apply for an in-house credit card, but at no additional cost. Is this requirement allowed?
1 and 2. If one is certain that they will pay the entire loan back without incurring any interest, then it would be permissible to engage in a loan transaction in this manner.
3. As for the requirement of applying for an in-house credit card at no extra cost, there is no actual benefit to the bank unless one starts to use the credit card in a manner which gives them interest. Hence, the mere requirement to apply for an in-house credit card would be fine. One should cancel the credit card if not needed.
Ifta Research Fellow
Checked & Approved by:
Mufti Abdul Rahman Mangera
Mufti Zubair Patel