Looking for a way to grow your money without compromising your beliefs? The Shari’ah Fixed Deposit account helps you earn profit on your savings through ethical, interest-free banking. It’s based on the Mudarabah principle, where you partner with the bank and share profits fairly.
What the Account Is For
This account is designed for Muslims (and anyone interested in ethical banking) who want to invest a lump sum for a fixed period and share in profits, instead of earning interest. It works well if you’re planning for goals like Hajj, education, or saving for your child’s future.
How the Account Works
- You deposit a lump sum of at least R1 000.
- You choose a fixed term (from 33 days to 5 years).
- Your money is invested in Shari’ah-compliant activities.
- The bank shares profits with you (50/50 split).
- Profits are calculated daily and paid monthly, quarterly, yearly or at maturity, depending on what you choose.
Example: If you invest R10 000 for 60 months and the indicative maturity rate is 8.90%, you could receive up to R8 900 in profit over the term (depending on actual performance).
Pros and Cons
| 👍 Pros | 👎 Cons |
| Profit-sharing, not interest | Profit is not guaranteed |
| Fixed term options (33 days to 5 years) | Early withdrawal may incur charges |
| No monthly fees | One-time deposit only |
| Shari’ah-compliant investing | Not covered by deposit insurance (CODI) |
Who Should Consider This Option
- If you want your investment to align with Islamic principles.
- If you’re happy to leave your money untouched for a fixed term.
- If you want an alternative to traditional interest-bearing fixed deposits.
Profit Structure
This account does not pay interest. Instead, you share in profits made by the bank using your money, based on the Mudarabah agreement.
Indicative profit examples (based on term and amount):
Balances R10 000 to R99 999
- 33 days to <3 months: 6.75%
- 6 months to <12 months: 6.95%
- 12 to <18 months: 7.25%
- 24 to <36 months: 7.75%
- 60 months: 8.90%
Profits are quoted per annum and paid in the frequency you select. (For the most accurate and up-to-date profit rates, please visit standardbank.co.za)
Tax Implications
- Profits are treated like interest by SARS.
- You’ll receive a tax certificate each year.
- First R23 800 in interest/profit is tax-free if you’re under 65.
- Beyond that, profits are included in your taxable income.
How to Apply
You’ll need:
- SA ID or passport (if not a citizen)
- Proof of address (not older than 3 months)
You can apply:
- On the Banking App
- Through Internet Banking
- At your nearest Standard Bank branch
Final Word
The Shari’ah Fixed Deposit account is ideal if you want peace of mind knowing your money is growing ethically and securely. Just remember, it’s a long-term commitment with fixed terms. But if you’re saving with purpose, this account can be a great fit.
Apply now via app, online or in-branch and let your money grow the Shari’ah-compliant way.