INVEST TO KAZAKHSTAN
Investing in Islamic deposits
With Islamic banking ’ s active development in Kazakhstan as well as all over the world , Islamic banking products are becoming more and more popular and interesting . Today we will elaborate more on a relatively new investment instrument – Islamic deposits . If you think about how to save and multiply your money , then it is definitely worth taking a closer look .
To begin with , the main aspect of all Islamic banking products is that they are provided in strict accordance with the rules and principles of Sharia , which affects how they work . At the same time , they meet the needs and expectations of customers to the same extent as conventional banking products .
How do Islamic deposits work ?
Islamic deposits are based on the principles of investment and partnership . The client provides the bank with funds for management , and the bank , using its knowledge and experience , invests those funds in businesses or projects with the subsequent sharing of profit with the client . The difference is that while conventional banks pay the client a fixed percentage for using the depositor ' s money , Islamic banks share with the depositors the profit from bank-financed projects .
What projects do they invest in ?
Investors ' funds are invested in Sharia compliant projects and businesses – all sectors of the economy of Kazakhstan : from manufacturing , agriculture , transport and logistics to large construction projects and companies in the oil and gas industries , that is to say , in businesses that yield benefits to people and the country ' s economy . Tobacco , alcohol , gambling , arms business , etc . are prohibited for investing . Al Hilal Bank very carefully selects projects for investment , because it needs to be sure of the reliability of the businesses in which it invests its funds and the funds of depositors .
What is the advantage of Islamic deposits ?
One of the advantages of Islamic deposits is profitability , which can be higher than the market for conventional products . For example , currently Al Hilal Bank deposits in dollars demonstrate some of the highest profitability in the Kazakhstan market . Religious reasons are also important for some clients , ensuring their funds are invested in Shariah compliant businesses . And , thirdly , reliability , which is confirmed by the high credit rating of the ADCB Group , of which Al Hilal Bank is a part ( ADCB group rating : А + from Fitch Ratings and А from Standard & Poor ' s ).
With regard to the conditions , deposits can be placed both in dollars and tenge , the minimum deposit amount is 150,000 tenge or 500 US dollars for a period of 1 to 24 months .
When opening a deposit , the client receives a Gold debit card with a free issuance and service .
Islamic Banking Myths
" Zero Interest means free "
An Islamic bank is a commercial bank that operates in accordance with the rules and principles of Sharia , and should be profitable , safe , and increase the funds of depositors , shareholders , and investors . The absence of interest rates does not mean that financing in an Islamic bank is free . According to Sharia , usury and charging interest on loans are prohibited . Therefore , unlike conventional banks , Islamic banks do not offer loans but utilize trade , leasing , and partnership structures , while avoiding speculative components .
" Only for Muslims "
Any person , regardless of religion , can become a client of an Islamic bank . Religion is not the only reason for using Islamic banking products . Many clients choose Islamic banks because of their reliability , especially in a period of economic instability , since they are careful and conservative in choosing financing projects , investing only in real sectors of the economy , and are not involved in speculative transactions . In this connection , they can be more reliable in the long term . There are , of course , also a share of clients for whom it is important that the bank adheres to the principles of Islam . For such clients , an Islamic bank allows them to use the products of modern banking , without violating their moral and ethical principles .
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