Islamic savings
How should I compare Islamic savings accounts?
A checklist for comparing Islamic savings products, including what to read in the terms and how to check Shariah governance.
The short answer
Compare contract type (profit-sharing, wakala, or expected-profit), transparency of returns, Shariah governance, liquidity and any fees. Look for clear statements about how returns are earned and how funds are managed. Do not assume an ISA wrapper alone makes a savings product halal.
Key comparison points
Check the contract model, the provider’s explanation of expected profit, any profit-sharing calculations, the Shariah advisory board and historical returns (not a promise of future results). Confirm how deposits are handled and whether returns are derived from interest-bearing activity.
Shariah-compliance considerations
A Cash ISA is not automatically halal. Islamic savings must be assessed by their contract and governance. Use AAOIFI Standard 21 where applicable for investments; for savings, review the product’s expected-profit terms carefully.
What this means in practice
- 1Read the product’s terms and Shariah opinion or governance statement.
- 2Compare expected-profit illustrations and the frequency of profit crediting.
- 3Ask about liquidity, penalties and how the provider treats client funds.