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How does Islamic banking work in practice? - Current Accounts |
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UK -
Islamic Current Accounts
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Source: Shariabanking.net
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Wednesday, 09 August 2006 |
Current accounts
Typical
Shariah-compliant current accounts do not charge or pay out any
interest. There is no overdraft facility available, but if an
overdraft is incurred an administration fee is charged.
Cheque books, debit cards, standing orders, direct debit and international payment facilities are usually on offer.
Most
banks use the principle of ‘qard’ which is a loan, free of profit. In
essence, it means your current account is a loan to the bank which is
used for investment and other purposes. It should be paid back to you
in full on demand. Your money will not be invested in activities that
contravene Shariah principles, such as the tobacco or alcohol
industries. |
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Last Updated ( Sunday, 07 January 2007 )
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