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Best Shari’ah-Compliant Savings Accounts

The best rates in the UK updated daily

Reach your savings goals with the help of the UK's first Shari’ah-compliant table. Our team of analysts update the rates in our comparison charts throughout the day. This means you can be sure of always getting the best UK rates when comparing savings accounts with us. Compare terms from one to five years alongside two new options - up to one year and 18 months. Discover the best rates below and apply today. All of the providers we feature are FSCS protected.

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We found 29 products in total, of which 16 have links to providers.

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Selecting ‘Provider Links First’ brings all products that you can apply for directly via Moneyfacts to the top of the chart in rate order. Products that do not have an ‘Go To Provider's Site’ button will appear below, again in rate order. Selecting ‘Rate’ will change the chart to list all products in rate order. Products that have ‘Go To Provider's Site’ links will still be in the list but in rate position.

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  • Habib Bank Zurich plc HBZ Sirat eDeposit (Fixed Term Account)
    AER
    5.05%
    Expected Rate
    Account Type
    Fixed
    Term
    12 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    5.01%
    Expected Rate
    Account Type
    Fixed
    Term
    6 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    5.00%
    Expected Rate
    Account Type
    Fixed
    Term
    1 Year Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • Habib Bank Zurich plc HBZ Sirat eDeposit (Fixed Term Account)
    AER
    4.90%
    Expected Rate
    Account Type
    Fixed
    Term
    6 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    4.80%
    Expected Rate
    Account Type
    Fixed
    Term
    18 Month Bond
    Interest Paid
    Anniversary
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    4.75%
    Expected Rate
    Account Type
    Fixed
    Term
    2 Year Bond
    Interest Paid
    Anniversary
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    4.73%
    Expected Rate
    Account Type
    Fixed
    Term
    3 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • QIB (UK) Raisin UK - 9 Month Fixed Term Deposit
    AER
    4.70%
    Expected Rate
    Account Type
    Fixed
    Term
    9 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • QIB (UK) Raisin UK - 6 Month Fixed Term Deposit
    AER
    4.60%
    Expected Rate
    Account Type
    Fixed
    Term
    6 Month Bond
    Interest Paid
    On Maturity
    Go To Provider's Site
  • Bank of London and The Middle East Premier Deposit Account (Anticipated Profit Rate)
    AER
    4.50%
    Expected Rate
    Account Type
    Fixed
    Term
    3 Year Bond
    Interest Paid
    Anniversary
    Go To Provider's Site
Depositor Protection

Eligible deposits with UK institutions are protected by the Financial Services Compensation Scheme (FSCS) up to a maximum level of protection of £85,000 per person per institution. All new savings or bank accounts provided to UK customers are now covered by the FSCS.

Disclaimer

All rates subject to change without notice. Please check all rates and terms before investing or borrowing.

Provider Links

‘Go To Provider's Site’ links are where we have an arrangement with a provider so you can move directly from our site to theirs to view more information and apply for a product. We also use ‘Speak to A Broker’ links where we have an arrangement with a preferred broker to move you directly to their site. Depending on the arrangement we may receive a modest commission either when you press a 'Go To Provider's Site' or 'Speak To A Broker' button, when you call an advertised number or when you complete an application following a link from our website.

What is an expected profit rate?

When looking for a savings account to suit your needs, you have probably come across the term “expected profit”. Used as a substitute for interest, this is the key difference between Shari’ah-compliant providers and other financing options.

An expected profit rate is the likely money you will earn over your investment period. It operates like interest, but it is calculated differently in order to comply with Shari’ah banking regulations.    

How does a Shari’ah-compliant savings account work?

Under Shari’ah law, interest is forbidden. It is seen as a means to promote unfairness in society, and is also known as “riba”.

Therefore, while non-Islamic banks pay interest on your savings deposit, a Shari’ah-compliant bank will instead use your funds to buy and sell different assets. This will generate a “profit” which will then be used to fund your rate.

These assets are also specific, with Shari’ah-compliant banking prohibiting investments into non-ethical funds. This means Islamic banks will not buy assets which do not adhere to the values of Islam, such as alcohol, pornography, gambling or tobacco, to name a few. In addition, they will not invest in other trading strategies such as shorting, options, and currency options.

Are Sharia’ah-compliant savings accounts ethical?

A Sharia’ah-compliant savings account can be one of the most ethical means of investing your funds on the market. As stated, Sharia’ah-compliant savings accounts will not fund investments which are linked to alcohol, pornography, gambling or tobacco to name a few.

With that being said, many other non-Islamic providers do not invest their funds into these types of activities either. Some are clear about this before you invest any money into their savings funds, while others carry more ambiguity.

Is my money safe in a Shari’ah-compliant savings account?

Yes, all Islamic banks adhere to the same regulations as other providers in the UK. This means all Shari’ah-compliant banks that are authorised in the UK are covered under the Financial Services Compensation Scheme (FSCS), whereby the first £85,000 of savings per person is protected in the event a bank fails or goes bankrupt. More information on this scheme can be found in our guide. 

Opening a Shari’ah-compliant savings account

Are Shari’ah-compliant savings accounts taxed?

Yes. Like all savings funds a Shari’ah-compliant savings account is also liable for income tax unless it benefits from being an ISA. You can learn more about how your savings are taxed in our comprehensive guide.

Do I need to be a Muslim to open a Shari’ah savings account?

No, Shari’ah-compliant banks and savings accounts are open to all savers in the same way as other savings accounts.

 

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Ashley Seager

Digital Marketing Manager

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Moneyfactscompare.co.uk will never contact you by phone to sell you any financial product. Any calls like this are not from Moneyfacts. Emails sent by Moneyfactscompare.co.uk will always be from news@moneyfacts-news.co.uk. Be ScamSmart.

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