Ethical provider pays 4.5% on fixed-rate bond

Islamic Bank of Britain (IBB) is offering annual returns of 4.5% to investors who open its 24-month Fixed Term Deposit Account.

The bank invests its money ethically according to Sharia principles - meaning you won’t putting your money into arms companies, alcohol firms or tobacco companies.

The Sharia principles that govern the account also mean it technically doesn’t pay interest, but rather an ‘expected profit rate’.

The account can be opened by both Muslims and non-Muslims with a minimum investment of £5,000, and is protected by the Financial Services Compensation Scheme, which covers the first £50,000 in all accounts.

Savers can choose to have returns paid every three months, or at the end of the investment.

Sultan Choudhury, IBB commercial director, said: “IBB has once again squared up to the UK’s conventional high street banks and is tempting customers with an ethical savings product that offers the most competitive returns in the UK.

“Consumers of all faiths are welcome, and are invited to join a bank that really knows how to look after their money.”

Consumer advice site Moneyfacts said the account will especially appeal to ethically minded savers.

Rachel Thrussell, Moneyfacts savings expert, said: “This rate is the best two-year fixed-rate on offer, but saving with the IBB might also appeal to those who wish to invest their money on ethical grounds.”

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