Best Islamic Fixed Deposits In Malaysia

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Best Islamic Fixed Deposits In Malaysia

No matter the economic climate, it’s always good to find a way to invest your money. And if you’re looking for a relatively easy and risk-free investment, a fixed deposit scheme is one of the best options you have.

But if you are looking for investment products that comply with Islamic law, conventional fixed deposits might not be a viable option for you. Shariah-compliant financial products demand the avoidance of riba (usury) and gharar (ambiguity or deception). Which is why you might want to look into Islamic fixed deposits instead.

Now if you’re wondering how to find out more about these Islamic fixed deposits just read on. We’ve curated 5 of the best Islamic fixed deposits (also referred to as term deposits) in Malaysia for your review.

What is a fixed deposit?

Before we get into it, first let’s review what a fixed deposit is.

According to our article on fixed deposit, a fixed deposit or ‘FD’, is a type of bank account that promises the investor a fixed rate of interest. In return, the investor agrees not to withdraw or access their funds for a fixed period of time.

So what is the difference between Islamic FDs and conventional FDs?

The difference lies in the returns given to the investors. In conventional fixed deposits, the profits received by the depositors are referred to as interest.

Think of conventional FDs as you lending your money to the bank. When the term ends, you get your money back along with interest.

But Islamic FDs don’t work like that, due to the fact that interest or riba as it’s called in Islam, is prohibited by Islamic law.

So instead, in Islamic FDs, the money you deposited will be used to invest in Sharia-compliant ventures. The profit from these investments will then be shared with you in a ratio that is predetermined between you and the bank.

Due to this reason, usually Islamic FDs offer a variable rate of return instead of a fixed rate like how conventional FDs do.

So, what are the best Islamic FDs in the market right now? Let’s get into it.

1) RHB Commodity Murabahah Deposit-i

The first one is RHB Bank’s Islamic FD offering, the RHB Commodity Murabahah Deposit-i.

The RHB Commodity Murabahah Deposit-i offers a variable rate of return, depending on the agreed term of deposit.

Key Features

Profit rate table

TenureProfit rate
1 month2.40%
2 months2.45%
3-5 months2.55%
6 months2.60%
7-11 months2.60%
12 months2.60%
>12 monthsNegotiable

Eligibility

  • Individuals aged 18 and above
  • Sole proprietorships
  • Societies, associations, companies and business enterprises
  • Non interbank money market participants and government institutions

Other key features

  • Flexible profit payment
  • Cash upfront payment at point of deposit placement is available
  • Perform transactions at any time via RHB Now
  • Known profit taking will be determined upfront upon placement
  • No service fees
  • Auto renewal is allowed (not applicable for cash upfront payment option)
  • Premature and partial withdrawal is allowed (terms and conditions apply)

2) Am50Plus Term Deposit-i

Are you 50 years of age or older? Then you might want to have a look at the Am50Plus Term Deposit-i, an Islamic FD designed for senior citizens.

Features

Profit Rate

The profit rate of the Am50Plus Term Deposit is fixed at 1.70%, which gives its users a sense of stability in their returns.

Term

6 to 60 months

Minimum placement

RM5000

Eligibility

Individuals aged 50 and above as a single account holder or together with another individual aged 18 and above, as a joint account holder.

3) Affin Islamic Term Deposit-i (TD-i)

The Affin Islamic Term Deposit-i is unique among Islamic FDs in the sense that it allows you to make full withdrawal before maturity of your agreed upon term, without any additional charges.

Features

Profit rate

Variable depending on the term of tenure and amount placed.

Term

1 to 60 months

Minimum placement

RM5000 for 1 month, RM500 for 2 months and above.

Eligibility

Any individual aged 18 and above.

Other key features

Early withdrawal without any charges
Early crediting of profit (upfront, monthly or at maturity)
Automatic renewal

4) CIMB Islamic Fixed Return Income Account-i (FRIA-i) – Maturity Returns

Looking for more options on your Islamic FDs? Then why not look at CIMB Islamic Fixed Return Income Account-i (FRIA-i) – Maturity Returns.

Features

Profit rate table

TenureProfit rate
1 month2.40%
2 months2.45%
3-5 months2.55%
6-14 months2.60%
15-35 months2.65%
36-60 months2.70%

Term

1-60 months

Eligibility

Individuals aged 18 years and above, joint account is allowed

Other key features

  • Profit paid off at maturity
  • Interim profit is paid every 6 months for tenures above 12 months
  • Automatic renewal
  • Option to pledge the certificate of deposits as security for financing

5) Maybank Islamic Prosperous Now! Account-i (PNA-i)

And finally, we have Maybank’s Islamic FD, the Maybank Islamic Prosperous Now! Account-i (PNA-i). For Maybank customers who want to stick with a known commodity, then the Maybank Islamic Prosperous Now! Account-i (PNA-i) is a good option.

Features

Profit rate table

TenureProfit rate
1 month2.30%
2 months2.35%
3-5 months2.45%
6-12 months2.50%

Term

12 months

Eligibility

For all individuals aged 18 and above only. Open to joint account holders (maximum 4 persons), business enterprises. associations/clubs/societies/organizations, trustees, foreigners, professionals, government and corporate funds.

Other key features

  • Free Personal Accident Takaful Coverage plus medical and funeral expenses (accident only) *
  • Acceptance as collateral for banking facilities*
*Depending on the terms and conditions, not applicable for all banking facilities.

What to look for when comparing Islamic fixed deposit products?

Banks’ promotional campaigns can be a good time to lock in good profit rates. Lookout for added benefits like insurance cover, enhanced loyalty points or credit card facilities that banks may throw in during promotions.

However, don’t forget to compare the following key points before making your choice.

Tenure options – Decide the length of time you want to lock away your money that you are comfortable with and look for products that match your time

Minimum deposit –  Check the minimum amount suits your budget without compromising your cash flow

Early access terms –  If you may need to access your funds early, check the terms for early withdrawal options and any penalties imposed.

So there you have it, the top 5 Islamic FDs on the market right now. If you’re interested in any of them, you can use our fixed deposit calculator tool and apply right here with us on this link.

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