Islamic Bank of Britain (IBB) has lowered the minimum deposit required to open a fixed-term savings account to £1, 000 (previously £5,000).
The bank is expecting a strong response to the move as its 24-month fixed-term account boasts a target profit rate of 4.5%, which IBB claims is a market leader.
For a shorter 18 month period the targeted return is 4%.
In both cases customers have the option of receiving their profit every three months or receiving the combined deposit and profit on maturity.
As an Islamic institution, IBB does not pay interest to its savers but instead offers a target profit rate on funds invested in Sharia’a compliant and ethical trading activities.
The bank monitors the target daily and informs customers if a rate is likely to be affected by market volatility.
In this case, savers are offered a choice of closing their account or receiving a lower rate of profit for the remainder of the fixed term.
Earlier this year, IBB was named the UK’s Best Islamic Financial Institution in the Global Finance magazine awards.
Growth in assets, profitability, geographic reach, strategic relationships, new business development and innovation were all considered in selecting IBB for the accolade.