A Mudarabah Deposit/Investment Account is an agreement between an entrepreneur (Mudarib) and a capital provider (Rabbul-mal), whereby the latter provides capital to be managed by the former. Profits from the capital are divided between both parties according to a mutually agreed profit-sharing ratio (PSR). Losses, however, are borne solely by the capital provider, unless they result from misconduct, negligence, or a breach of agreed terms by the entrepreneur.
Customer Target Group:
- Individuals aged 18 years and above.
- Legal entities, including sole proprietors, MSMEs, corporations, associations, partnerships, etc.
Product Features :
- Can be opened and operated individually or jointly.
- Requires a minimum investment fund of Birr 50,000.
- Issuance of a Certificate of Investment Fund.
- Backed by a contractual agreement ensuring compliance with Shari’ah principles.
- Minimum investment period of 6 months and a maximum of 24 months.
- Withdrawals are subject to specific terms and conditions (e.g., early withdrawal).
- Minimum Progressive Profit Sharing Ratio PSR of 40:60 (40% for the bank and 60% for the customer), with consideration for tenure and value.
- Minimum investment fund starts at Birr 50,000.
- Profits are paid 5 days after maturity.
- Options for renewing the initial investment fund, including profits, based on customer requests.
- Auto-Renewal: Automatic renewal of the initial investment fund or inclusive of profit as per customer preference.
Eligibility Requirements:
- Fulfill all basic KYC and due diligence requirements (as applicable in current practice, e.g., regular Wadi’ah Saving Account).
- Must maintain either a Wadi’ah Saving Account or Qard account.
- Willingness to declare that the sources of deposits are Halal or Shari’ah compliant.
