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Liability Products

  • Basic Banking Accounts
  • Current Accounts
  • Profit and Loss Sharing Accounts
  • Taqwa Rahat Corporate Account
  • Taqwa Rahat Account
  • Riba Free Certificates (Term Deposits)
  • Taqwa Asaan Current Account
  • Taqwa Asaan Saving Account
  • Taqwa Business Account
  • Taqwa Meherbaan Certificate
  • Taqwa Direct Pension Credit Account
  • Taqwa Asaan Remittance Account
  • Taqwa Committee Account
Basic Banking Account

Basic Banking Account is based on the Islamic principle of Qard such that the Bank is the ’Borrower’ and the depositor is the ‘Lender’.

Main purpose of introducing Basic Banking Account is to facilitate and provide basic banking facilities to the low income people.

The salient features of this account are as follows:

  • The minimum initial deposit will be Rs. 1,000/-
  • Account will be opened in PKR.
  • The account will be non remunerative account.
  • No limit on minimum balance. In cases, where balance in BBA remains 'nil' for a continuous six month period, such accounts will be closed.
  • No fee for maintaining BBA.
  • Free of charge ATM withdrawals from the bank's own ATMs. In case of withdrawal from BBA through the ATM machines of other banks, bank shall recover charges as per schedule of charges.
  • Statement of Account will be issued once in a year free of charge.
  • Other service charges will be applicable as per approved schedule of charges.
Current Account

Current Accounts are based on the Islamic principle of Qard such that the Bank is the ’Borrower’ and the depositor is the ‘Lender’.

The salient features of this account are as follows:

  • The minimum initial deposit will be Rs. 1,000/
  • Account will be opened in PKR, USD, GBP & EURO.
  • The Principal amount is guaranteed.
  • The account will be non remunerative account
  • Unlimited deposits and withdrawals are permissible.
  • Zakat deductions are not applicable.
  • Other service charges will be applicable as per approved schedule of charges.

* Any benefits in money, kind or services over and above the Principal amount is interpreted as Riba unless such benefits are admissible for all account holders without discrimination

Eligibility criteria
  • Individuals (18years & old)
  • Sole Proprietorships
  • Partnerships
  • Companies
  • Clubs / Societies / Associations / Trusts
Profit & Loss Sharing Account

The relationship between the Bank and customers holding Savings accounts shall be based on the principles of Mudaraba/Musharakah, where the Bank shall be Mudarib and customers shall be Rabbulmal. Further, the relationship is based on unrestricted Mudaraba arrangement. The salient features of this account are as follows:

The minimum initial deposit will be Rs. 100/- However, no initial deposit would be required for opening of accounts by (i) Mustahkeen of Zakat, (ii) Students, (iii) Employees of Government or Semi Government institutions for salary and pension purposes (including widows/children of deceased employees eligible for family pension/benevolent fund grant, etc.) and other similar types of accounts.

  • Account will be opened in PKR, USD, GBP, EURO.
  • Minimum balance charges are not applicable
  • Funds will be invested in Shariah Compliant Products.
  • Profit will be calculated on average balance of the month basis and distributed on monthly basis
  • Withholding Tax and Zakat deductions are applicable as per rules.
  • Other service charges will be applicable as per approved schedule of charges.
    Note: In case a depositor(s) deposits during a month, he shall pay the due proportionate share in profit, based on monthly average balance during the month. If a depositor divests during a month, the “ad hoc profit” for the number of days for which the balance remains invested, during such month, shall be paid at the profit rate for the preceding month.
Eligibility criteria
  • Individuals (18years & old)
  • Sole Proprietorships
  • Partnerships
  • Companies
  • Clubs / Societies / Associations / Trusts
Taqwa Rahat Corporate Account

The relationship between the Bank and customers holding Savings accounts shall be based on the principles of Mudaraba, where the Bank shall be Mudarib and customers shall be Rabbulmal. Further, the relationship is based on unrestricted Mudaraba arrangement. The salient features of this account are as follows:

  • Account will be opened in PKR.
  • Account will be available for business entities only.
  • Minimum initial deposit for opening of account will be Rs. 100/-.
  • Minimum balance charges are not applicable.
  • Funds will be invested in Shariah Compliant Products.
  • Profit will be calculated on Daily Product (net) Balance in Customer account and distributed on monthly basis.
  • Withholding Tax and Zakat deductions are applicable as per rules.
  • Other service charges will be applicable as per approved schedule of charges.

Note: In case a depositor(s) close his/her account during a month, the “ad hoc profit” for the number of days for which the balance remains invested, during such month, shall be paid at the declared profit rate for the preceding month for ‘Taqwa Rahat Corporate Account’.


Taqwa Rahat Account

The relationship between the Bank and customers holding Savings accounts shall be based on the principles of Mudaraba, where the Bank shall be Mudarib and customers shall be Rabbulmal. Further, the relationship is based on unrestricted Mudaraba arrangement. The salient features of this account are as follows:

  • Account will be opened in PKR.
  • Account will be available for Individuals only.
  • Minimum initial deposit for opening of account will be Rs. 100/-.
  • Minimum balance charges are not applicable.
  • Funds will be invested in Shariah Compliant Products.
  • Profit will be calculated on Daily Product (net) Balance in Customer account and distributed on monthly basis.
  • Withholding Tax and Zakat deductions are applicable as per rules.
  • Other service charges will be applicable as per approved schedule of charges.

Note: In case a depositor(s) close his/her account during a month, the “ad hoc profit” for the number of days for which the balance remains invested, during such month, shall be paid at the declared profit rate for the preceding month for ‘Taqwa Rahat Account’.


Riba Free Certificates - RFCs

The relationship between the Bank and customers holding Riba Free Certificates shall be based on the principles of Mudaraba , where the Bank shall be Mudarib and customers shall be Rabbulmal. Further, the relationship is based on unrestricted Mudaraba arrangement.

The salient features of this account are as follows:

  • Investments can be made for 1 month, 3 months, 6 months, 1 year, 2 years, 3 years, 4 years and 5 years
  • Account will be opened in PKR.
  • Minimum investment required is PKR 10,000
  • Profit payment options are monthly and at maturity.
  • Profit payment is made to the investor’s designated account in BOP as per terms opted by the customer.
  • Profit will be calculated on daily product basis and distribution will be made as per terms customer has opted for.
  • Premature encashment will be made according to premature schedule.
  • Withholding Tax and Zakat deductions are applicable as per rules.
Taqwa Asaan Current Account

Taqwa Asaan Current Account is based on the Islamic principle of Qard, such that the Bank is the ’Borrower’ and depositor is the ‘Lender’.

The salient features of this account are as follows:

  • The minimum initial deposit will be Rs. 100/- for account opening
  • Account will be opened in PKR only
  • Transactions limits:
    • Total Debit per month Rs. 500,000/-
    • Total Credit Balance Limit Rs. 500,000/-
  • Only Individuals can open these accounts as single or joint accounts.
  • The Principal amount is guaranteed.
  • The account will be non-remunerative account
  • No minimum balance requirement
  • Zakat deductions are not applicable
  • Separate account opening form will be used for opening of Asaan Accounts
  • Other service charges (if any) will be applicable as per approved schedule of charges
  • Other terms & conditions as per account opening form
Taqwa Asaan Saving Account

The relationship between the Bank and customers holding Taqwa Asaan Savings accounts shall be based on the principles of Mudaraba, where the Bank shall be Mudarib and customers shall be Rabb-ul-maal. Further, the relationship is based on unrestricted Mudaraba arrangement.

The salient features of this account are as follows:

  • The minimum initial deposit will be Rs. 100/- for account opening
  • Account will be opened in PKR only
  • Transactions limits:
    • Total Debit per month Rs. 500,000/-
    • Total Credit Balance Limit Rs. 500,000/-
  • Profit will be calculated on average monthly balance basis and paid monthly
  • Deposits are maintained on single tier basis
  • Only Individuals can open these accounts as single or joint accounts
  • No minimum balance requirement
  • WHT and Zakat are applicable as per government rules
  • Separate weightages shall be announced for this category of account
  • Separate account opening form will be used for opening of Asaan Account
  • Other service charges (if any) will be applicable as per approved schedule of charges
  • Other terms & conditions as per account opening form
Taqwa Business Account

With TAQWA Business Account customers can now transact their entire banking related activities nationwide through single platform. Additionally, this product is packed with exclusive free of cost services which will facilitate customers on every touch point of their business cycle to ensure business prosperity and growth.

This account works in accordance with Shari’ah Principles and following are its salient features:

  • Mudarabah Based product whereby the profit is distributed between the customer and Bank based on the pre-determined profit sharing ratio and weightages.
  • Free IBFT.
  • Free Online Banking.
  • Free ATM/Debit Card.
  • Free issuance of Cheque Books.
  • Free issuance of universal cheques.
  • Free issuance of CDR.
  • Free Collection of OBC upto thrice of last month’s average balance.
  • Free e-banking facility to view account balance and statement of account.
  • Free of Cost Utility Bills Deposit Facility through BOP ATM Network, BOP Phone Banking and self-service IVR system.

Note:

  • Withholding Tax and Zakat applicable as per prevailing laws and regulations of Government.
  • In case Customer doesn’t maintain the monthly average balance of Rs.25,000/- in a month, then exclusive free services – offered under TAQWA Business Account - on the account will be charged as per prevailing Schedule of Bank Charges.
Taqwa Meherbaan Certificate

TAQWA Meherbaan Certificate (TMC) is structured within the realm of Mudarabah principles which offer’s small/medium depositors a medium term low risk and high return avenue with regular stream of profit to cater their house hold and other domestic needs.

The salient features of this account are as follows:

  • Mudarabah based product whereby the profit is distributed between the customer and Bank based on the pre-determined profit sharing ratio and weightages.
  • Fixed interval profit payment – Monthly.
  • Booking amount limit:
  •  • For single Account holder, Rs 100,000/- to Rs. 7,500,000/-.
     • For Joint Account Holders, Rs 100,000/- to Rs.15,000,000/-.
  • Tenure 3 years.
  • Multiple TMC(s) booking option.

Note:

  • Withholding Tax and Zakat applicable as per prevailing laws and regulations of Government.
  • No partial withdrawals and deposits except pre-mature encashment.
  • In case of premature encashment profit shall be calculated as per Profit & loss Distribution Policy Framework of the Bank.
Taqwa Direct Pension Credit Account
Taqwa Direct Pension Credit Account is a depository account which aims at providing the necessary tool for pensioners to transact their entire Pension payment related activities through single platform. This account can be opened by any individual/single pensioner.
The salient features of this account are as follows:
  • Mudarabah based product whereby the profit is distributed between the customer and Bank based on the pre-determined profit sharing ratio and weightages.
  • Account will be opened in PKR
  • Account can be fed through Pension payment only
  • No local or international credit shall be allowed in the account
  • No commercial remittance shall be deposited in the account
  • The account will be opened by single person (pensioner) only.
  • No requirement for initial deposit.
  • Profit will be calculated on average balance of the month.
  • The bank account shall not be a joint account
  • Withholding Tax and Zakat will be applicable as per prevailing laws and regulations of Government.
  • Other service charges (if any) will be applicable as per approved schedule of charges.
  • Other terms & conditions will be applicable as per account opening form.
TAQWA ASAAN REMITTANCE ACCOUNT
Taqwa Asaan Remittance Account will facilitate low income/ unbanked customers to receive home remittances through proper account instead of resorting to traditional cash over counter transactions.
The salient features of this account are as follows:
  • Qard based product whereby the Bank is the ’Borrower’ and Customer is the ‘Lender’.
  • The account will be non-remunerative account.
  • Account can be fed through home remittance only.
  • Only individuals are eligible to open this account in Single or Joint capacity.
  • Maximum credit balance limit will be Rs. 2,000,000.
  • Cash withdrawal limit will be Rs. 50,000 per day (ATM & COC both).
  • Funds transfer limit from Taqwa Asaan Remittance Account to any other account will be Rs. 50,000 per day.
  • No requirement for initial deposit.
  • No local credit shall be allowed in the account.
  • No outward remittance shall be allowed.
  • No commercial remittance shall be deposited in the account.
  • Names of prospective remitter(s) and relationship with beneficiary will be provided by the customer.
  • Other service charges (if any) will be applicable as per approved schedule of charges.
  • Other terms & conditions will be applicable as per account opening form.

TAQWA Committee Account
TAQWA Committee Account is a unique saving solution which offers regular savers a medium term low risk and high return avenue for savings with flexible options and affordable denominations. The essence of TAQWA Committee Account is the “Multiplier” effect, the Mudarabah partnership increases with time and so does the return.
The salient features of this account are as follows:
  • Mudarabah Based product whereby the profit is distributed between the customer and Bank based on the pre-determined profit sharing ratio.
  • Monthly accumulation of profit - payable at maturity.
  • Fixed monthly investment structure.
  • Investment Denominations - Multiple of Rs. 2,000 (i.e., Rs. 2,000/-, Rs. 4,000/-, Rs. 6,000/- and onwards) with a cap of Rs. 20,000/-month.
  • Flexible Term options of 01 and 03 years.
  • Multiple Committee booking options.

NOTE:

Withholding Tax and Zakat is applicable as per prevailing policy of Government.
No partial withdrawals and deposits except pre-mature settlement


Asset Side Products

  • Murabahah Financing
  • Diminishing Musharakah Financing
  • Kafalah (Bank Guarantees)
  • Ijarah
  • Istisna
  • Running Musharakah
Product
Product Purpose
Remarks
Murabahah Financing Working capital Requirement/procurement of Raw Material/Semi Finished Goods/Finished Goods Revolving facility line, renewable subject to facility history / account behavior
Trade related facilities based on Murabahah LC Sight
LC Usance
Total Tenure of Sight LC will not exceed 365 days
Total Tenure of Usance LC will not exceed 365 days
Diminishing Musharakah Financing Term financing will be limited as per Facility approval of respective customers to a maximum tenure of 20 years for Commercial customers. Rental and principal payments in monthly / quarterly / semiannual installments. To finance Capital Expenditure
Kafalah (Bank Guarantees) Bid Performance Mobilization Financial Repayment Shipping any other As per approval from Concerned Committee on case to case basis
Ijarah For import of machinery/equipment/vehicles for Corporate Commercial /SME /Retails customers. As per approval from concerned committees.
Istisna Working Capital requirement Revolving facility line, renewable subject to facility history / account behavior
Murabahah / Musharakah IERF As per SBP Criteria
Murabahah

Murabahah means a sale of goods by a person to another under an arrangement whereby the seller is obliged to disclose to the buyer the cost of goods sold either on cash basis or deferred payment basis and a margin of profit included in the sale price of goods agreed to be sold. Murabahah is transacted in tangible assets only. Murabahah shall not be transacted in respect of any debt instrument including receivables. Being a sale transaction, it is essential that the commodities which are the subject of sale in a Murabahah transaction must exist, owned by the seller and in his physical or constructive possession.

Therefore, it is necessary that the seller must have assumed the risks of ownership before selling the commodities to the buyer/customer. It is a fixed price sale and normally is done for short term. The transaction can be used in order to meet the working Capital requirements by way of purchase of goods. It cannot be used to meet overheads payments such as settlement of utility bills or payment of salaries or settlement of amounts owed to others. Murabahah, as a mode of financing, has become synonymous with facility sale of goods by the Banks. As such, almost all kinds of businesses, including those providing services (hotels & hospitals, e.g.) may be the target for Murabahah facilities for their tangible assets or inventory.

Diminishing Musharakah

Diminishing Musharakah (DM) is a form of co-ownership in which two or more people share the ownership of a tangible asset in an agreed proportion and one of the co-owners undertakes to buy in periodic installments the proportionate share of the other co-owner until the title to such tangible asset is completely transferred to the purchasing co-owner.

Diminishing Musharakah can be created only in tangible assets. It shall be limited to the specified Asset(s) and not to the whole enterprise or business. Proportionate share of each co-owner must be known and defined in terms of investment. There will be an undertaking by one of the co owners to the effect to purchase the units of other co-owner at a mutually agreed price until the entire ownership of the asset is transferred to the purchasing co owner.

Additionally, an undertaking shall be given by the other owner to the effect that he will sell the units owned by him to the first co-owner in the event the latter desires to purchase the units earlier than the agreed schedule on such price as may be mutually agreed. Also rental agreement is in place with customer enabling bank to collect the rental on bank’s rented share to customer.

Ijarah

Ijarah refers to a transaction where the corpus of leased assets remains in the ownership of the Lessor and the Lessee is allowed to benefit from the usefulness of these assets (i.e., their usufruct) for a consideration. Only those assets can be leased which can be used while retaining their original form, e.g., land, building, machinery, tools, crockery & cutlery. During the entire term of the lease, the Lessor must retain title to the assets, and bear all risks and rewards pertaining to ownership. However, if any damage or loss is caused to the leased assets due to the fault or negligence of the Lessee, the consequences thereof shall be borne by the Lessee.

The consequences arising from non-customary use of the asset without mutual agreement will also be borne by the Lessee. The Lessee is also responsible for all risks and consequences in relation to third party liability, arising from or incidental to operation or use of the leased assets. The insurance/takaful of the leased asset preferably are in the name of Lessor and the cost of such insurance/takaful borne by him. The amount of rental must be agreed in advance in an unambiguous manner either for the full term of the lease or for a specific period in absolute terms.

Mudaraba

Mudaraba means an arrangement in which a person participates with his money (called Rabbulmal) and another with his efforts (called Mudarib) for sharing in profit from investment of these funds in an agreed manner. A Mudarib may be a natural person, a group of persons, a legal entity or a corporate body.

The profit shall be divided in strict proportion agreed at the time of contract and no party shall be entitled to a predetermined amount of return or remuneration. Financial losses of the Mudaraba shall be borne solely by the Rabbulmal; unless it is proved that the Mudarib has been guilty of fraud, negligence or willful misconduct or has acted in contravention of the mandate. The Mudarib can invest his funds in the business of the Mudaraba with the permission of Rabbulmal. The condition is that in such situation, the Rabbulmal shall not be entitled to a proportion of profit in excess of the ratio that his investment bears to the total investment of the enterprise. The loss, if any, shall be shared in proportion to the Capital of the parties. The amount of Mudaraba investment standing to the facility of Rabbulmal on the culmination or termination of Mudaraba arrangement shall be undertaken to be discharged by the Mudarib.

Istisna

Istisna is a mode of sale, at an agreed price, whereby the buyer places an order to manufacture, assemble or construct, or Cause so to do anything to be delivered at a future date. Price of the goods to be manufactured must be fixed in absolute and unambiguous terms. The agreed price may be paid in lump sum or in installments in the matter mutually agreed by the parties.

Unless otherwise mutually agreed, any party may cancel the contract unilaterally if the seller has not incurred any direct or indirect cost in relation thereto. If goods manufactured conform to the specifications agreed between the parties, the purchaser cannot decline to accept them except if there is an obvious defect in such goods. However, the agreement can stipulate that if the delivery is not made within the mutually agreed time period, then the buyer can refuse to accept the goods. The IBOP IBD (buyer in Istisna) can enter into a Parallel Istisna contract without any condition or linkage with the original Istisna contract. In one of them, the BOP IBD will be the buyer and in the second the seller. Each of the two contracts shall be independent of the other. They cannot be tied up in a manner that the rights and obligations of one contract are dependent on the rights and obligations of the parallel contract.

Further, Parallel Istisna is allowed with a third party only. In Istisna transactions the buyer shall not, before taking possession (actual or constructive) of the goods sell or transfer ownership in the goods to any other person. If the seller fails to deliver the goods within the stipulated period, the price of the commodity can be reduced by a specified amount per day as per the agreement. Also Murabahah can be done instead of parallel Istisna.

Running Musharakah

Running Musharakah is Shariah compliant alternative of Running Finance Facility available in conventional banking system. Running Musharakah is based on the concept of Musharakah. The word Musharakah is derived from the Arabic word Shirkah meaning partnership. Islamic jurists point out that the legality and permissibility of Musharakah is based on the injunctions of the Qur'an, Sunnah, and Ijma (consensus) of the scholars.

Purpose of extending Running Musharakah facility is to finance working capital requirements of customer. Unlike Murabaha where finance is allowed for a specific purpose (sale/ purchase of item). In Running Musharakah, customer can utilize the funds for any of its Shariah Compliant working capital requirements.

Letter of Credit (LC) through Murabahah

LC is one of the most widely used modes of settling trade debts on an international level. Also, it is a convenient method for obtaining short-term financial accommodation from banks by the customers.

The concept of documentary letter of facility is to provide comfort and protection to suppliers / exporters, in respect of payment of the good supplied to the importers, by providing written assurance to pay the specified amount, in the original currency, upon conformity / acceptability of the documents.

It is pertinent to mention that the payment is guaranteed upon fulfillment of certain terms and conditions and submission of desired documents under Uniform Customs and Practices (UCP) 600 {The Uniform Customs and Practice for Documentary Facility (UCP) is a set of rules on the issuance and use of Letters of Facility. It provides all the important aspects and definition of terms used in documentary operations in foreign trade}.

The documentary letter of facility is deemed to be irrevocable unless specially marked as “Revocable”. “Irrevocable” documentary LCs may not be amended or cancelled without the agreement of all the parties involved.

LCs, in general should not exceed 90 days. In Case of any exception, the facility should be adequately collateralized and/or sources of retirement should be properly identified. Reference to UCP 600 is to be made for details on types of LCs.

This page was last updated on: July 19, 2021 11:30:00 AM
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