While most customers prefer to bank according to Islamic law, Shariah accounts are open to everyone regardless of religion or culture. Some non-Muslim savers may find the higher savings rates on offer attractive.
Shariah-compliant savings accounts work similarly to standard accounts, but with one key difference.
It is against Islamic law to pay or charge interest on money, so savers receive a share of the bank’s profits, known as the expected profit ratio, or EPR.
That’s the number that appears on the bank’s website and in the Best Buy table, but unlike interest, it’s not guaranteed, said Anna Bowes, founder of savings rate service Savings Champion. “If the bank is unable to pay the EPR, it gives the savers the option of canceling the bond and pocketing the amount earned till then.”
Their track record so far has been good. For example, since Al Rayyan Bank was established in 2004, it has always paid the quoted profit rate to customers.
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