The Shari’ah Board of Accounting and Auditing Organization of Islamic Financial Institutions (AAOIFI) held its 67th meeting virtually. It endorsed the Shari’ah Standard on “Payment Cards”. It is noteworthy that the Shari’ah Board has issued a standard on cards 17 years back. However, due to substantial technical developments in the area of financial transactions, the situation demanded a resolution from the Shari’ah Board to re-look into the present version and re-issue the standard afresh by keeping pace with recent developments in the financial transactions. The Shari’ah board has assigned one of its members known for his comprehensive and scholarly experience in this field, to prepare a detailed study on the matter with a proposal of a draft of the new standard. The Shari’ah board deliberated extensively upon the draft in several meetings.
Further, the AAOIFI Secretariat arranged two meetings that included some members of the Shari’ah board and representatives of Visa Inc. These meetings were supported by a generous sponsorship from Alinma Bank (Saudi Arabia), which hosted the discussions in its headquarters. The meetings aimed to understand the advanced technical features related to credit cards. Also, the Shari’ah board invited one of the senior representatives from Visa Inc. for the same purpose. These meetings resulted in a clear understanding of credit card functioning, which may help to describe the present set-up for Shari’a accommodation to reach the relevant Shari’ah rulings.
After completing the discussion by the Shari’ah Board, the AAOIFI Secretariat was directed to release the draft on AAOIFI’s official site. This was followed by public hearing sessions held in Riyadh and Dubai to receive comments and notes from the industry professionals including scholars, experts and banking professionals.
This was followed by six virtual Shari’ah board meetings, which started from August 2020 until the standard issuance date. After this, the Shari’ah board has assigned the drafting committee, comprising five members from the Shari’ah board, to review and discuss the standard only from the drafting perspective. The drafting committee completed the task in four meetings. The revised draft was presented to the Shari’ah board in its last meeting and by the Grace of Allah, the Shari’ah board endorsed the presented draft.
The standard is in the design stage and will be made available in due course in its final and approved form, In-shā’-Allah.
Additionally, the Shari’ah board concluded the discussion on the draft of a Shari’ah standard on Sukuk. The Shari’ah board also approved the reconstitution of four of its new subcommittees for the new tenure. Names of the respected members of the committees will be released within a week from issuing this statement.