Is a savings account or term deposit halal, and what is the alternative?
An interest-bearing savings account or term deposit pays riba and fails the financial-structure test.
The categories that exist in Australia for money that would otherwise sit in such an account:
- Islamic income funds - managed funds targeting a regular distribution from compliant assets
- Sukuk exposure - held directly or through a fund
- Profit-rate deposit-style products offered by Islamic finance providers
These are investments, not deposits. They are not covered by the Financial Claims Scheme, their value can fall, and access terms differ from an at-call account.
Factual and educational information only. Nothing on this page is financial product advice, a recommendation, or a Shariah ruling. Consider your circumstances and the product's disclosure documents, and seek licensed advice and qualified scholarly guidance before acting.