Features
The Islami Dollar Bachat account is ideal for individuals and businesses who are eager to save in US Dollar. This saving scheme is for both; Residents & Non-residents, who need to either save in US Dollars or remit money from abroad for personal or business transactions. The Islami Dollar Bachat account is a profit/loss bearing account in USD based on the principle of Mudaraba where the Bank invests your funds in a Shariah compliant manner. The profit and loss from the investment is then shared between you and the Bank.
The Islami Dollar Bachat Account offers you the following key salient features:
- Free Internet Banking service
- Safe deposit lockers (subject to availability)
- 100% interest free
- Monthly profit/loss payment on daily product basis
- A minimum balance of USD. 100/- in cash or through USD clearing cheque or valid instructions of remittances from abroad
- No Zakat or Withholding tax applicable
- Joint Account facility
- Access to the entire online branch network
- No restrictions on intercity transactions
- Round the clock phone Banking through 111-ISLAMI (475-264)
- Personalized service from Customer Relationship Officers
- Free Account statement facility
- Hold mail and stop payment facility
How It Works?
BankIslami’s Islami Dollar Bachat account is a profit bearing account developed on the basis of the modes of Mudarabah. This is how it works:
- You provide funds to the Bank on Mudaraba basis for investment in the Bank’s Shariah Compliant Assets
- In this arrangement, you will function as a Rabbul Maal (investor in Mudaraba) and the Bank will act as the Mudarib (Manager of the Mudaraba)
- The Bank will form a pool of customers’ funds
- The pool provides financings to various individuals, corporate, government and other entities based on various Islamic modes of finance such as Murabaha, Ijarah, Musharakah, Mudaraba and other modes and would generate income
- The Bank will calculate income from the pool on a monthly basis. This income will be shared between the Bank and the Depositors as per a pre agreed profit sharing ratio
- The profit share of the Bank is called the Mudarib’s share. This profit sharing ratio between the Bank and the Depositors is determined at the beginning of the month
- The profit share of the depositors is based on the predetermined weightages assigned at the beginning of the month. A weightage based profit distribution mechanism ensures that the return paid to any Customer in a Profit & Loss sharing contract is proportionate to the risk taken
- In the case of a loss, as per the rules of Mudaraba, the loss will be borne solely by the Rabbul Maal. The loss will be distributed between various categories of customers on a pro rata basis. Bank also suffers loss as no income is generated against its efforts
To Understand the Difference between Islami dollar bachat account and conventional saving account kindly click
Fatwa
Documents
The documents required vary with the customer category as follows:
- Salaried Individual /Joint Account Holders
- Filled Account Opening Form
- Computerized National Identity Card (CNIC)
- Passport (for Non-residents only)
- Employment proof (Pay slip, Employment letter etc)
- Sole Proprietors
- Filled Account Opening Form
- Computerized National Identity Card (CNIC)
- Passport (for Non-residents only)
- NTN Certificate
- Partnership/Club/Society/Association/NGO/Trust
- Certified Copy of Partnership/ Trust Deed
- Certificate of Registration
- Signatures of all Partners on letter of Partnership
- Certified copy of rules
- Certified copy of resolution
- Copy of by-laws
- Copy of NTN Certificate
- CNICs of all Partners
- Passports (for Non-residents only)
- Limited Company
- Certificate of Incorporation
- Certificate for Commencement of Business (PLC only)
- Memorandum of Association
- Articles of Association
- Current list of Directors
- Copy of Board Resolution
- CNICs of all Directors
- Copy of NTN Certificate and Form 29
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FAQs
Q. Where are the funds deposited in Islami Dollar Bachat Account invested?
- All Islami Dollar Bachat Account funds received by BankIslami are invested in Shariah approved US Dollar based investments either on shore or off shore and in providing US Dollar financing to customers.
Q. Is there any Zakat or Withholding tax deductible on the profit on Dollar Bachat Account?
- No, there is no Zakat or Withholding tax deductible on Profit credited in a Dollar Bachat account holder.
- Mudaraba is a form of partnership where one party provides funds while the other party provides expertise and management to manage the business or investment fund. The provider of funds is known as Rabbul Maal and the entrepreneur is referred to as Mudarib.The profit is shared in pre-agreed ratios, and loss, if any, unless caused by negligence or violation of terms of the contract by the Mudarib is borne by the Rabbul Maal.
Q. What makes Islami Dollar Bachat Account Shariah Compliant?
- All funds raised by BankIslami are invested in businesses which are in compliance with Shariah. Importantly, they are invested in the manner which is prescribed by Shariah. All profit & losses are pooled and distributed according to rules of Shariah between BankIslami and the depositors. The pre-agreed profit sharing weightage is announced at the start of each month and can be obtained from the branch, Website or Phone Banker. Based on this profit sharing weightage, the Islami Bachat Account holder would be distributed the share in profit for the month at the beginning of the next month.
Q. What is the relationship between an Islami Dollar Bachat Account holder and BankIslami?
- An Islami Dollar Bachat Account holder provides funds as 'Rabb-ul-maal' and BankIslami invest these funds as 'Mudarib' i.e the fund manager. Based on this relationship, the depositors and BankIslami become beneficiaries of the profit earned. When the joint investment pool earns profit, it is distributed in the pre-agreed ratio of depositors and BankIslami. In case of the unlikely event of loss, the depositors on the pro-rata basis bears the loss whereas the Bank goes un-rewarded for all its efforts and bears all the costs incurred for doing the business.
Q. What is the profit offered on Islami Dollar Bachat Account?
- As per Shariah requirements, profit can not be committed to the customer upfront. The profit rates can only be determined after actual income from pool of assets is determined. Profit announcement at the beginning of next month will determine the profit paid. However, the sales person can share the rates announced for previous months to provide the customer with indicative rate(s).
Q. How many transactions are allowed on an Islami Dollar Bachat account?
- Unlimited
- The funds in Islami Dollar Bachat account can only be invested in a Shariah compliant pool of assets whereas there is no such restriction on a Conventional Savings Account.
Q. How is the Customer's profit calculated?
- Profit from the pool of Shariah compliant assets is calculated at the end of every month. BankIslami keeps a share of the profit as a Mudarib's share. The balance profit is distributed between various categories of Customers as per predetermined weightages. The profit amount for each category is used to calculate the Profit rates for each category of Customers, which are announced at the beginning of next month
Q. Can there be a loss in Islami Dollar Bachat Accounts?
- Yes, if there is a loss in the overall pool of Shariah compliant assets the same will passed on to the Customers in the exact ratio of their investment in the portfolio. However, BankIslami is a professional Mudarib and takes utmost care in investing and extending financing to Customers.
Q. Who determines if Islamic Dollar Bachat Account is Shariah Compliant?
- The Shariah Supervisory committee of BankIslami, comprising of Mufti Irshad Ahmad Aijaz (Chairman, Shariah Supervisory Board), Mufti Javed Ahmad (Resident Shariah Board Member) & Mufti Muhammad Husain Khaleel Khail (Member, Shariah Supervisory Board) has the responsibility to oversee that all products, process and transactions pertaining to any deposit product offered by BankIslami are Shariah compliant. A Shariah Audit is also conducted periodically to ensure compliance with Shariah. The State Bank of Pakistan also conducts a Shariah Audit to ensure Shariah compliance.
Q. What is withholding tax on profit?
- Withholding tax is a tax payable to the Government of Pakistan on the profit credited in the account of a Savings or Term Account holder. The Withholding tax is 10% of the profit.
BankIslami
Registered / Head Office
11th Floor, Executive Tower, Dolmen City, Marine Drive, Block-4, Clifton, Karachi.
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