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242. Interest on a Credit Card

If a person lends their credit card to another for making a purchase, there is no problem if the borrower repays the lender before the close of the credit card cycle. However, if the borrower does not pay back in time and interest accrues, it is forbidden for the borrower to reimburse the card holder for the interest being charged. Since the credit card company knows only the card holder, as far as they are concerned, the card holder is the one who made the purchase and is now being charged interest. In effect, the card holder extended an independent loan to the one who made the purchase on the credit card; even though the interest charge resulted from the borrower�s purchase, a Jew may not charge another Jew ribis, interest, nor may they accept reimbursement. If one uses another�s card and agrees in advance to repay the interest as it becomes due, it is considered ribis ketzutzah, a form of ribis which is strictly forbidden mide�oraysa, from the Torah.

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