Maybank Singapore launches new Islamic term deposit

For a minimum placement of S$10,000 or US$6887 for a 12-month tenure, clients can avail of Maybank Singapore's first Islamic term deposit. It has a minimum of S$25,000 or US$17,218 for a 3- and 6-month tenure. This deviates from the current available Islamic term deposit products in the market. For example, some products require a minimum placement of US$500,000, catering only to the high net worth segment.

Called the Term Deposit-i, it will pay fixed returns at promotional rates of 0.6 percent, 1.0 percent and 1.4 percent. It has tenures of 3, 6 and 12 months respectively.

Term Deposit-i is based on the commodity Murabaha principle, which is on a cost plus profit sale concept. Under this concept, a specific Syariah-compliant commodity will be identified and used as the underlying asset for the sale and purchase transaction between the customer and the Bank.

A similar product, Profit Now Account-i was launched by Maybank Islamic Bhd in Malaysia in May 2009. The product was very well-received with more than US$364.6 million total deposits to date.

Maybank Singapore’s first Islamic Term Deposit joins the fleet of other innovative Islamic banking products offered such as iSAVvy Savings account-i, a Syariah-compliant online.

Since the introduction of the Islamic deposit products in 2005, Maybank Singapore has seen an average year-on-year increase of over 40 percent in Islamic deposits. This increase aligns with the global expected growth of over 40 percent to US$1 trillion by 2012.

"The current market presents an opportune time to take on a back-to-basic approach. Consumers are on the lookout for an alternative to conventional products and this term deposit, being Syariah-compliant may very well match their needs," said Mr Mohd Ismail Hussein, Head of Islamic Banking, Maybank Singapore.

"Islamic banking is a fairly new concept in Singapore which is gaining momentum very quickly. There are also non-Muslims amongst our Islamic banking customers and this shows the concept is for everyone. With Maybank being the market leader in Islamic Banking in Malaysia, the operations in Singapore is in good stead to ‘break the ice’ between Islamic Banking and the local retail market," he added.