Mudaraba

Investment deposit

Zaman Bank

Mudaraba is a form of investment deposit, where the Depositor (Rabbul Mal) transfers his capital to the Bank who acts as a Manager (Mudarib) and invests the capital in investment projects with different risk levels. Profit is divided between the Bank and the Depositor according to pre-agreed proportion. As in all other types of Islamic deposits, remuneration cannot be guaranteed either directly or indirectly, due to the fact that the result of investment activity is not known and any profit received is distributed in fact.


The Depositor’s capital also may not be guaranteed, because only Depositor bears all financial losses, unless proved: negligence of the Bank and/or there is a violation of the terms of the Mudaraba agreement by the Bank.


In other words, it is capital transferred by the customer to the bank for a certain period without guarantee of their return in nominal terms, under the condition of payment of profit on it depending on the results of using transferred capital.


This type of deposit will be of interest for those, who have some savings and are ready to take risk. Peculiarity of the investment deposit is in availability of limit on minimum deposit amount and duration.


Example: The Customer opened an investment deposit based on Mudaraba, put an amount of 5.000.000 tenge taking into account the agreement of profit sharing: 70/30, to the Client and the Bank respectively. Upon expiration of the agreement, summing up the results of its investment activity the Bank came to the conclusion that total profit under this project amounted to 2.400.000 tenge. Taking into account the profit sharing agreement, the Customer receives 1.680.000 tenge (2.400.000-70%) and the Bank receives 720.000 tenge (2.400.000-30%).


In total, the Client receives 6.680.000 tenge excluding minimum commission fees, administrative and other expenses associated with this investment project. The Bank also receives 720,000 tenge from the investment project, as well as a service fee.


Product Name

Mudaraba Standard

Deposit currency

KZT (tenge), USD (US dollars), EUR (euro)

Minimum deposit amount

1 000 000 KZT / 3 000 USD / 3 000 EUR

Maximum deposit amount

not limited

Maturity

1/3/6/12/24/36 months

Rate of Return

Depends on the tenor and currency of deposit

Periodicity of profit payment

on expiry date

Additional contributions

allowed

Partial withdrawal

allowed

Special conditions

in case of full withdrawal before expiry date profit on deposit is not payable


Note 1: Deposit terms may be changed individually by the decision of the authorized body.


Note 2: Rate of return on the deposit means a share of profit generated by the Bank as a result of investing deposited funds in Sharia compliant projects financed to be paid to the depositor. Rate of return depends on term and currency of the deposit.


Deposit Term

Coefficient of profit share

(Client/Bank)

in tenge

in USD/EUR

1 month

20/80

5/95

3 months

30/70

10/90

6 months

45/55

15/85

12 months

50/50

20/80

24 months

55/45

25/75

36 months

60/40

30/70