PAYING BANK CHARGES WITH INTEREST MONEY

In the Name of Allah, the Most Gracious, the Most Merciful.

As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.

It will not be permissible in Shariah to offset any bank charges (all fees that are neither inclusive of interest nor any impermissible charge) against the interest accrued to the card holder in the same bank. The reasons are two fold;

Firstly, it is not permissible in Shariah to open an interest bearing account. Surplus money should always be deposited in a current account where no interest is received. Secondly, if somebody has deposited his money in an interest bearing account erroneously, he cannot use the amount of interest for his own benefit nor can he use it to settle any rightful claim against him. Since the annual fee of a credit card is a rightful claim against the card holder, he cannot set it off by the amount of interest accrued on his account. (Contemporary Fataawa pg.199)