Just seven out of 15 websites that present best buy information present Shariah-compliant accounts directly alongside those from other providers, according to the bank’s analysis.
This means that, despite Shariah-compliant products now being considered mainstream, 53% of sites do not give the consumer the clearest picture by ranking the Shariah-compliant accounts alongside the rest.
Gatehouse Bank believes this makes it more difficult for savers to identify those accounts best suited to protecting their nest eggs from inflation.
One explanation for their different treatment is the distinction in the language used by Shariah-compliant banks.
Because they are unable to pay interest, Shariah-compliant savings accounts offer customers an alternative to an interest rate, called an Expected Profit Rate (EPR).
The two are incredibly similar but EPR is not technically guaranteed. This helps to create a distorted view of the risks, of lack of them, associated with these accounts because Gatehouse Bank has in fact never failed to pay the EPR.
Gatehouse Bank’s Milestone Savings deposits are protected by the Financial Services Compensation Scheme (FSCS), which covers up to £85,000 per person.
As an ethical institution, Gatehouse Bank does not invest in gambling, alcohol, tobacco or arms companies. Examples of eligible investments include construction projects, property investments and Islamic bonds.
Charles Haresnape, CEO, Gatehouse Bank, commented:
“It is vital that comparison websites, which give the impression they are presenting savers with the best rates on the market, live up to that expectation by including Shariah-compliant accounts.
“These accounts frequently offer some of the best, if not the best, rates and are growing rapidly in popularity among all kinds of customers.
“These sites are designed to help consumers, who shouldn’t have to go hunting for the best rates and should be encouraged to consider ethical, Shariah-compliant banking as an alternative to the high street.
“Otherwise savers are left ‘rates blind’ and wrongly assume they are aware of all their options.”
Gatehouse Bank’s Milestone Savings current rates are listed below (correct as of 9 May 2018):
- 1 Year Fixed Term Deposit: 1.90% AER
- 2 Year Fixed Term Deposit: 2.05% AER
- 3 Year Fixed Term Deposit: 2.21% AER
- 5 Year Fixed Term Deposit: 2.45% AER
- 31 Day Notice: 1.05% AER
- 60 Day Notice: 1.15% AER
- 120 Day Notice: 1.53% AER