Can I Use PayPal Withdrawals?

Answered by Shaykh Irshaad Sedick

Question 

In the PayPal withdrawal system, there’s a time delay between my withdrawal request and the arrival of the funds into my bank account. They apply a currency conversion rate and charge a fee during the withdrawal. Is it permissible, and if not, what should I do with my PayPal balance?

Answer

In the Name of Allah, the Most Merciful and Compassionate. May Allah guide our hearts, tongues, and deeds to that which perpetually pleases Him.

Based on the three components in the description, the transaction appears permissible, and Allah knows best.

Time Delays in Transactions

Immediate exchange in a transaction is not a requirement in the Sacred Law, except when transacting usurious items from the same genus, e.g., wheat for barley or dollars for pounds. [Nawawi, Minhaj Al-Talibin]

Currency Conversion 

Exchanging one currency for another is permissible as long as it fulfills the condition above. In this case, the currency conversion takes place the instant the transaction takes place. [Nawawi, Minhaj Al-Talibin]

Withdrawal Service Fee

Charging a fee for providing a service is permissible, which applies equally to a legal (halal) financial product/service. [Nawawi, Minhaj Al-Talibin]

 I pray this is of benefit and that Allah guides us all.

[Shaykh] Irshaad Sedick

Checked and Approved by Shaykh Faraz Rabbani

Shaykh Irshaad Sedick was raised in South Africa in a traditional Muslim family. He graduated from Dar al-Ulum al-Arabiyyah al-Islamiyyah in Strand, Western Cape, under the guidance of the late world-renowned scholar, Shaykh Taha Karaan. 

Shaykh Irshaad received Ijaza from many luminaries of the Islamic world, including Shaykh Taha Karaan, Mawlana Yusuf Karaan, and Mawlana Abdul Hafeez Makki, among others.

He is the author of the text “The Musnad of Ahmad ibn Hanbal: A Hujjah or not?” He has served as the Director of the Discover Islam Centre and Al Jeem Foundation. He served as the resident Imam of Masjid al-Munowar in Retreat, Cape Town, for several years.

Shaykh Irshaad has thirteen years of teaching experience at some of the leading Islamic institutes in Cape Town). He is currently building an Islamic online learning and media platform called ‘Isnad Academy’ and pursuing his Master’s degree in the study of Islam at the University of Johannesburg. He has a keen interest in healthy living and fitness.