Islamic credit cards barred from alcohol, gambling, nightclub payments

Bangladesh Bank has issued comprehensive guidelines for Islamic credit cards, prohibiting their use for purchasing alcohol, gambling, nightclub services, conventional insurance, illegal dating services and pork-related products.

The guidelines, issued on Monday, aim to ensure interest-free transactions in line with Shariah principles. Banks must block prohibited transactions through Merchant Category Codes and cancel cards immediately if customers make illegal transactions.

Banks can charge service fees (Ujrah) for card issuance, renewal and maintenance but cannot impose interest or retain late-payment penalties as income. Such penalties must be deposited in separate charitable accounts under the supervision of the banks’ Shariah committees.

The guidelines also make two-factor authentication and one-time password-based consent mandatory. Banks must refund unauthorised transactions within seven working days of receiving a request to block a lost or stolen card.

Registered Islamic banks and Islamic windows or branches of conventional banks can issue these cards, while foreign or dual-currency cards require authorised dealer status.

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