Islamic Saving Account Zakat Exempt
Description and features
|
Apply in a few simple steps through Riyad Bank App and branches
|
For the Terms and Conditions, Click Here
FAQs
FAQs – Islamic Saving Account - Zakat Exempt
1. Product Overview & Shariah Structure
Q1: What is the Islamic Savings Account (Zakat Exempt)?
Islamic Saving Account-Zakat Exempt is an addition to the deposit portfolio of the Bank. It is a Shariah-compliant savings account based on a Mudarabah (profit-sharing) structure, where customers deposit funds and the Bank invests them in low risk shariah compliant assets which are zakat-exempt.
In Islamic Savings Account, deposits are invested in shariah compliant assets only and the returns (profits) from there are distributed between the Bank and Customer based on agreed profit-sharing ratios. Bank can provide an expected profit rate to the customer on the savings account.
Q2: What is the Shariah basis of this account?
The account operates under a Mudarabah contract, where:
Customer = Rabb-ul-Maal (Capital Provider)
Bank = Mudarib (Investment Manager)
Q3: Are returns (profit rates) on Islamic Savings Account – Zakat Exempt guaranteed?
Profits are not guaranteed. However, Bank makes valuable due diligence before investing customer’s funds in Zakat-Exempt Sukuks and accordingly can provide an expected profit rate to the customer on their deposits.
Q4: Where are the Depositor’s funds invested?
Funds are invested in Zakat Exempt Sukuks (Islamic bonds)
2. Profit & Returns
Q5: How is profit calculated?
Profit will be calculated on the Monthly Average Balance of the Islamic Savings Account based on the expected annual profit rate
Q6: What is the expected profit rate?
The expected annual profit rate 3.75%
Q7: Is there a minimum balance for earning profit?
A. Yes, a minimum monthly average balance (SAR 20,000) is required to calculate and be eligible for profit.
3. Account Features
Q8: What are the key features of the product?
- Available for all Retail segments (individuals)Customers
- Acceptable Currency: SAR (SAUDI RIYAL)
- Minimum required for account opening : NIL
- Monthly profit payment (minimum 20k SAR monthly average balance).
- Customer Eligibility: An active current account with RB
Q9: Can customers transfer funds freely?
Transfers are allowed:
- Between own accounts within Riyad Bank (within Riyad Bank)
- To other party accounts within Riyad Bank (within Riyad Bank)
- To other accounts outside Riyad Bank (local transfers)
Q10: Will this product be available from all Banking channels i.e. Branch Banking, Mobile App and Online Banking?
Yes
4. Zakat Treatment
Q11: Do customers need to pay Zakat on this account?
No. The account is Zakat-exempt at the individual level.
Q12: What does “Zakat Exempt” mean?
The term ‘Zakat Exempt’ means that the Bank will manage and ensure under the regulation guidelines from competent authorities to deploy these funds into Sharia-compliant Sukuk investments (Government Bonds) only, which are Zakat exempt.
Q 13. Does the Bank pay the Zakat on behalf of the Customer?
No. the bank does not pay the Zakat on behalf of the Customer but invests the depositor’s funds in zakat - exempt assets.
Q 14. Can the Bank compensate the Customer for the Zakat Value?
No, because the funds are invested in zakat-exempt assets, which are not subject to Zakat.
5. Illustration: Profit Calculation
Q 15. Mr. Abdullah has invested 50,000 SAR in Islamic Saving Account Zakat Exempt. During the period, he further deposited some funds while transferred significant amount to his current account for personal need with following effective dates
Date |
Description |
Amount |
01-Mar-26 |
Account opening |
25,000 |
11-Mar-26 |
Credit |
10,000 |
16-Mar-26 |
Credit |
5,000 |
26-Mar-26 |
Debit |
-11,000 |
Compute the profit calculation for March (assuming expected annual equivalent rate 3%)
Calculation:
To calculate profit payment, we need to compute monthly average balance during March first.
Effective Days |
Duration |
Account Balance |
Day 1 - Day 10 |
10 Days |
25,000 |
Day 11- Day 15 |
5 Days |
35,000 |
Day 16- Day 25 |
10 Days |
40,000 |
Day 26- Day 31 |
6 Days |
29,000 |
|
|||||
Monthly Average Balance (MAB) = 32,225.81 |
|||||
Eligibility of Profit (Y/N) YES (<20,000)
Expected annual equivalent rate 3%
Profit Payment = MAB* Expected Annual equivalent rate *Number of days during March/ Number of days during Year
Profit payment = SAR 83.25
1. FAQs – Islamic Saving Account - Zakat Exempt
1. Product Overview & Shariah Structure
Q1: What is the Islamic Savings Account (Zakat Exempt)?
Islamic Saving Account-Zakat Exempt is an addition to the deposit portfolio of the Bank. It is a Shariah-compliant savings account based on a Mudarabah (profit-sharing) structure, where customers deposit funds and the Bank invests them in low risk shariah compliant assets which are zakat-exempt.
In Islamic Savings Account, deposits are invested in shariah compliant assets only and the returns (profits) from there are distributed between the Bank and Customer based on agreed profit-sharing ratios. Bank can provide an expected profit rate to the customer on the savings account.
Q2: What is the Shariah basis of this account?
The account operates under a Mudarabah contract, where:
- Customer = Rabb-ul-Maal (Capital Provider)
- Bank = Mudarib (Investment Manager)
Q3: Are returns (profit rates) on Islamic Savings Account – Zakat Exempt guaranteed?
Profits are not guaranteed. However, Bank makes valuable due diligence before investing customer’s funds in Zakat-Exempt Sukuks and accordingly can provide an expected profit rate to the customer on their deposits.
Q4: Where are the Depositor’s funds invested?
Funds are invested in Zakat Exempt Sukuks (Islamic bonds)
2. Profit & Returns
Q5: How is profit calculated?
Profit will be calculated on the Monthly Average Balance of the Islamic Savings Account based on the expected annual profit rate
Q6: What is the expected profit rate?
The expected annual profit rate 3.75%
Q7: Is there a minimum balance for earning profit?
A. Yes, a minimum monthly average balance (SAR 20,000) is required to calculate and be eligible for profit.
3. Account Features
Q8: What are the key features of the product?
- Available for all Retail segments (individuals)Customers
- Acceptable Currency: SAR (SAUDI RIYAL)
- Minimum required for account opening : NIL
- Monthly profit payment (minimum 20k SAR monthly average balance).
- Customer Eligibility: An active current account with RB
Q9: Can customers transfer funds freely?
Transfers are allowed:
- Between own accounts within Riyad Bank (within Riyad Bank)
- To other party accounts within Riyad Bank (within Riyad Bank)
- To other accounts outside Riyad Bank (local transfers)
Q10: Will this product be available from all Banking channels i.e. Branch Banking, Mobile App and Online Banking?
Yes
4. Zakat Treatment
Q11: Do customers need to pay Zakat on this account?
No. The account is Zakat-exempt at the individual level.
Q12: What does “Zakat Exempt” mean?
The term ‘Zakat Exempt’ means that the Bank will manage and ensure under the regulation guidelines from competent authorities to deploy these funds into Sharia-compliant Sukuk investments (Government Bonds) only, which are Zakat exempt.
Q 13. Does the Bank pay the Zakat on behalf of the Customer?
No. the bank does not pay the Zakat on behalf of the Customer but invests the depositor’s funds in zakat - exempt assets.
Q 14. Can the Bank compensate the Customer for the Zakat Value?
No, because the funds are invested in zakat-exempt assets, which are not subject to Zakat.
5. Illustration: Profit Calculation
Q 15. Mr. Abdullah has invested 50,000 SAR in Islamic Saving Account Zakat Exempt. During the period, he further deposited some funds while transferred significant amount to his current account for personal need with following effective dates
Date |
Description |
Amount |
01-Mar-26 |
Account opening |
25,000 |
11-Mar-26 |
Credit |
10,000 |
16-Mar-26 |
Credit |
5,000 |
26-Mar-26 |
Debit |
-11,000 |
Compute the profit calculation for March (assuming expected annual equivalent rate 3%)
Calculation:
To calculate profit payment, we need to compute monthly average balance during March first.
Effective Days |
Duration |
Account Balance |
Day 1 - Day 10 |
10 Days |
25,000 |
Day 11- Day 15 |
5 Days |
35,000 |
Day 16- Day 25 |
10 Days |
40,000 |
Day 26- Day 31 |
6 Days |
29,000 |
|
|||||
Monthly Average Balance (MAB) = 32,225.81 |
|||||
Eligibility of Profit (Y/N) YES (<20,000)
Expected annual equivalent rate 3%
Profit Payment = MAB* Expected Annual equivalent rate *Number of days during March/ Number of days during Year
Profit payment = SAR 83.25
Banking Made Easy for You
Let us simplify your financial life
Join Riyad Bank for secure, seamless, and stress-free banking. Take the first step today.
