Cashback is halal when it is a discount or gift from the seller of something you bought, and doubtful when it is a benefit paid by someone you have lent money to or borrowed from. Cashback sites such as TopCashback and Quidco pass you a share of the commission a retailer pays for the sale, which is a permissible rebate. Supermarket loyalty points are the same thing in a different wrapper. Cashback credit cards are different: the card is an interest-bearing loan agreement, and most scholars treat rewards paid by the lender as a benefit derived from a loan contract. Bank switching bonuses sit in the same disputed category. The is it halal hub covers the principles; this article applies them to each type of cashback British Muslims actually receive.
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The fiqh test: who is paying, and under which contract?
Three contracts explain almost every cashback arrangement. A sale (bay') allows the seller to discount the price, before or after payment, and a rebate on a sale is simply a lower price. A gift (hiba) is permissible when it is not a condition of a loan. A loan (qard) must be returned like for like, and the maxim scholars cite is that any benefit stipulated for the lender in return for the loan is riba. So the questions for any cashback are: who is paying it, is it attached to a sale or to a loan, and was it advertised in advance as a condition of the arrangement?
There is a second question that people skip: is the underlying contract one you may enter at all? A cashback credit card pays rewards, but it is also a credit agreement that contains interest terms. Even a scholar who regards the cashback itself as a gift from the issuer must still rule on whether signing that agreement is permissible. That is why the credit card question is harder than the cashback site question, and why the answer depends less on where the money comes from than on what you signed.
| Source of cashback | Who pays | Attached to | Position |
|---|---|---|---|
| TopCashback, Quidco | Retailer commission shared | A sale | Permissible |
| Clubcard, Nectar, store points | The retailer | A sale | Permissible |
| Debit card cashback from a bank | The bank | A current account (a loan to the bank) | Contested, leaning permissible if not balance-linked |
| Cashback credit card | Card issuer | An interest-bearing credit agreement | Contested, stricter view says avoid |
| Bank switching bonus | The bank | Opening a current account | Contested, stricter view says avoid |
| Cashback on a conventional insurance purchase | Insurer via comparison site | A conventional insurance contract | The cashback is fine; the insurance is the issue |
Cashback sites: how TopCashback and Quidco are actually funded
TopCashback's own explanation is the whole fiqh answer. When you buy from a retailer after clicking through, the retailer pays TopCashback a commission for sending the customer, and TopCashback shares that commission with you as cashback. The retailer, not a lender, pays it, and it is paid because a sale happened. TopCashback's Classic membership is free; the Plus tier deducts £5 a year from your cashback for extra benefits. It lists over 5,500 retailers and pays out to a bank account, PayPal or gift cards that can carry a bonus of up to 20%.
Quidco works the same way across more than 5,000 retailers, with a Premium tier that costs £1 only in months you shop through it and offers up to 25% higher rates at selected retailers. It also offers card-linked in-store cashback of up to 6.8% and gift card purchases with up to 18% cashback. Quidco is owned by MONY Group, which also owns MoneySuperMarket. Commission sharing on a sale is permissible: it is a brokerage fee passed on as a price reduction. The gift card bonus is also fine, since you are buying a voucher for less than its face value, not exchanging money for money.
Three caveats. The purchase itself must be halal; cashback on alcohol or a conventional insurance policy does not change the ruling on the thing bought. Cashback for signing up to a credit card or an interest-paying savings account through these sites is an inducement to enter a riba contract, and the offer is not worth the contract. And card-linked in-store cashback is only as clean as the card you link: a debit card is fine, a credit card brings back the credit card question.
Supermarket loyalty points and retailer rewards
Loyalty points from Tesco, Sainsbury's, Boots or any other retailer are a deferred discount on purchases you have made. The retailer funds them, they attach to sales, and nobody lends anyone money. They are permissible, and vouchers that multiply their value for partner spending are simply a bigger discount. Points earned on an item you should not have bought are not the point; the problem is the purchase.
The exception is the retailer-branded credit card that earns points on all spending. The points are from the retailer, but the card is a credit agreement with a bank, and it is assessed as a credit card. If you want loyalty points without that contract, pay with a debit card and scan the loyalty card; you lose the extra points on spending outside the store and keep your contracts clean.
Cashback credit cards: the three positions UK scholars hold
The strict position, common among UK Hanafi muftis, is that signing a credit agreement that contains interest terms is itself impermissible, so a cashback credit card fails before the cashback is even considered. On this view the cashback is a benefit from an entity you have a loan facility with, and the fact that it is funded by interchange paid by merchants does not matter, because it is paid to you by the lender under the credit contract.
The permissive position holds that a credit card cleared in full each month involves no interest in practice, that the rewards are a gift funded by merchant fees rather than by interest, and that the interest clause is a dormant term. On this view the cashback is permissible for someone who never carries a balance. The middle position, which we find most consistent with how the contracts are written, is that holding a conventional card is tolerated where there is a genuine need, such as car hire deposits or purchase protection, but the rewards it generates should be given away rather than kept, because they flow from a contract you entered under necessity rather than choice.
Our view is practical. The UK has no Shariah-certified credit card in 2026, which our halal credit card page explains, so every cashback credit card is a conventional credit agreement. A card that earns 1% on spending generates small sums; it is not worth signing a riba contract for. If you need a card for a specific purpose, use it for that purpose, clear it in full, and treat the rewards as money to give away.
Bank switching bonuses under the loan rule
The Current Account Switch Service, run by Pay.UK, moves your payments and balance to the new bank, closes the old account and guarantees that you are covered for any charges or interest incurred if something goes wrong, all for free. Banks pay switching bonuses to attract customers through it. The fiqh problem is that a conventional current account is, in substance, a loan from you to the bank, and the bank is advertising a benefit to anyone who makes that loan. Under the strict reading that is a stipulated benefit on a loan, and it is riba regardless of the label.
The counter-argument is that the bonus is a flat sum, not proportional to your balance or to time, and is paid for the act of switching direct debits and using the account rather than for the money deposited. Some scholars accept it on that basis as a marketing gift unrelated to the loan amount. The honest answer is that the question is contested, that the stricter view is the majority among UK scholars we have read, and that the flat-sum argument is weakest when the bank also requires a minimum pay-in, which ties the bonus directly to funds lent. If you switch to a conventional bank because you need a current account that does not pay interest, the clean route is to decline the bonus or give it away. Our guide to halal current accounts in the UK covers which accounts are structurally free of interest.
What to do with cashback you already hold
- Sort it by source: cashback from sites, retailers and loyalty schemes is yours to keep and spend.
- Cashback or rewards paid by a credit card issuer or a bank switching bonus you now regret: give the amount to charity without the intention of reward, in the same way interest is purified; our purification guide explains the mechanics.
- Do not count purified amounts as zakat or sadaqah for your own account, and do not use them for personal or family benefit.
- Close or stop using cashback credit cards unless you have a defined need, and move daily spending to a debit card from an account that pays no interest.
- If you want app-based rewards without a credit agreement, Algbra and Kestrl are UK e-money accounts built without interest; check their current reward terms in-app, since we have not verified any specific cashback rate on their sites.
- Keep using TopCashback or Quidco for purchases you would make anyway, and ignore their credit card and savings account offers.
Verdict: who should do what
If you use cashback sites and loyalty cards and pay by debit, nothing changes: the cashback is a discount on a sale and you may keep it. If you hold a cashback credit card, decide what the card is for. If it exists to earn rewards, close it; the rewards are not worth the contract. If it exists for car hire or purchase protection, keep it for that, clear it every month, and give the cashback away. If you are being offered a switching bonus, treat it as a benefit on a loan and decline it unless you follow a scholar who permits it, in which case note that a required minimum pay-in weakens the argument you are relying on.
The broader point is that cashback is a small sum and contracts are large commitments. The halal bank accounts hub lists the accounts that keep your money outside interest altogether, and our Premium Bonds analysis applies the same loan rule to a product millions of British savers hold. Facts checked against topcashback.co.uk, quidco.com, currentaccountswitch.co.uk on 1 October 2026.
Frequently asked questions
Is TopCashback halal?
Yes. TopCashback explains on its site that retailers pay it a commission for sending customers, and it shares that commission with you as cashback. The money comes from a seller because of a sale, which makes it a price rebate, not a benefit on a loan. The purchase itself must be halal, and you should ignore cashback offers for credit cards or interest-paying accounts.
Is cashback from a credit card halal?
It is contested. The stricter and more common UK scholarly view is that a credit card is a credit agreement with interest terms, so signing it is impermissible and rewards from the issuer are a benefit tied to that contract. A permissive minority allows it when the balance is cleared in full. The cautious route is to give card cashback to charity and to use a debit card for spending.
Are bank switching bonuses halal?
Most UK scholars treat them as a stipulated benefit on a loan, because a conventional current account is money lent to the bank and the bonus is advertised in advance for depositing it. A minority accepts them as flat marketing gifts unconnected to the balance. If you switch for a legitimate reason, declining or donating the bonus removes the doubt.
Are Tesco Clubcard points halal?
Yes. Clubcard points, Nectar points and similar retailer schemes are deferred discounts funded by the retailer on purchases you make, and no loan is involved. Vouchers that multiply the value of points with partners are simply a larger discount. The only version to assess separately is a retailer-branded credit card, which is a credit agreement and is judged as one.
What should I do with cashback I earned on a credit card?
Give it to charity without intending reward, which is the same treatment scholars prescribe for interest received. Do not count it towards zakat and do not spend it on yourself or your family. Then decide whether the card has a defined purpose; if it exists only for rewards, close it and move spending to a debit card from an account that pays no interest.
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Is cashback on insurance bought through Quidco halal?
The cashback itself is a commission rebate on a sale and is not the problem. The question is the insurance contract: most scholars regard conventional insurance as containing uncertainty and interest-based investment, with exceptions for cover that is legally required such as motor insurance. Buy what you must, take the rebate, and do not treat the cashback as a reason to buy cover you would otherwise avoid.
