members of the family can be accurately assessed in advance, and liquidity
can be planned without having to deal with any unpleasant surprises.
Credit Cards and Automatic Teller Machine (ATM) Debit Cards An RF bank
offers two types of card services. The first is a regular credit card, which is
administered and the credit approved by an outside credit card company, to
avoid participating in riba and to minimize credit risk at the bank. This ser-
vice is offered as a convenience to some, but not many, of our customers, so
that the bank can offer all services needed in the market. It is important to
note that the management at the Bank of Whittier trains the RF private
bankers to give customers who apply for and use credit cards a very clear
warning (which is also prominently displayed on the bank’s Web site):
Credit cards are offered for shopping convenience; each customer
should spend within his/her means and pay the card charges within
the month to avoid paying interest. Credit cards are not meant for
borrowing with interest.One day, a member of bank management received a call from a bank-
ing regulator, commending us for our very unusual invitation to people
not to use their credit cards as a means of very expensive borrowing and
our encouraging customers to pay the charges off as soon as possible
(preferably no longer than a month). It is well known in the riba-based
banking industry that credit card interest charges and fees have grown
recently to represent a significant source of income for most of these riba-
based banks.
In addition, the RF Bank of Whittier offers a Visa-linked debit card that
allows the customer to debit his/her account directly anywhere in the world.
We did not call itIslamic, as some have done, because our disciplined policy
requires that we call it what it really is.
Risk Management for an RF Bank
It should be stressed that the credibility and performance of a new RF bank
are not only the professional duties of the RF bankers but also their respon-
sibility before God. It is important to design RF bank operations, policies,
and systems in a fashion that minimizes the RF bank’s risk of failure, which
would result in the loss of people’s money and trust. If that were to happen,
the dream of popularizing this new brand of banking would die for the next
three to four generations, because humans tend to remember failures over
an average of three to four generations. RF bankers simply cannot and
should not allow this to happen.
352 THE ART OF ISLAMIC BANKING AND FINANCE