You're probably wondering: Does eToro offer Islamic accounts?
The quick answer to that is YES. An Islamic account is available for users want to trade while still following the Quran and related finance restrictions.
Also known as swap-free accounts, this type of account has been created primarily for traders of the Islamic faith as they won't be charged with interest, commissions or rollover fees.
Via this quick-and-easy guide, we'll go into detail about the specifics of this Islamic-compliant account that is provided by eToro.
Take a look at the table of contents below and continue reading to get all the essential information you need about eToro's Islamic account and how you can easily open one if you're a follower of the Islamic faith.
If you are then, click the button below and this will take you to the simple instructions on how to create and activate an Islamic account with eToro.
An Islamic trading account differs a lot from a regular trading account. As stated on the Sharia law, it prohibits the accumulation of interest so under no circumstances, they are not allowed to pay or receive interest rates or what is called as "Riba" in any form. This specific account type needs to completely aligned and follow the basic principles of Islamic law.
Under this type of account, you are relieved from paying fees on any trades that are left open overnight.
Here's the deal:
Any open trades in the currency market are automatically rolled over if they are not closed by 5:00 pm (New York time) and under a regular trading account, these open trades are bound to be charged with usurious interest which is against the Islamic law and is called "Haram".
But if you are using an Islamic account, there are no rollover or weekend charges if your position has not been closed for over 24 hours. You can even hold your positions as long as you want and it will not incur any fees.
Here's the thing: Money that is transferred to or from a bank account (something that is similarly done with currency trading) is considered by religious law specialists as delivery or an exchange between hands.
The good news is that "fatwas" or formal rulings have been created with regards to currency trading and among the decrees issued according to the Sharia law is that transactions need to be settled immediately and the costs must also paid during this process. Such ruling of immediate buying and selling of currencies is strictly followed by eToro as trades are executed in real time without any delays.
The Islamic account that is offered by eToro is a halal trading account in accordance with the Sharia law. That means that eToro is a halal trading broker since they provide a specific account that is in full compliance with the religious principles and finance rules of Islam.
Residents from Saudi Arabia and the United Arab Emirates can open an account and trade with eToro. There are no restrictions for users who are based in these countries.
The company doesn't have any physical office in these nations and is currently not regulated by the Saudi's Capital Market Authority (CMA) and UAE's Abu Dhabi Global Market (ADGM) and Dubai Financial Services Authority (DFSA).
Here's the list of the most populous Muslim countries which eToro supports:
On the other hand, below are the list of countries and territories with a significant population of Muslim residents where eToro is blocked due to changes in regulations:
You might be wondering how eToro makes money if their Islamic trading accounts won't impose any interest rates since the Sharia law prohibits this.
Look: eToro only receives revenues from the spreads and that is based on the difference from the currency pair's buy and sell prices. In addition, you won't even get charged with fees for account management.
This account type is offered by eToro exclusively to Muslim clients and as part of the requirements, they will ask for a proof of religion before converting the account. This document may be accomplished from a religious organization in your area, community or neighborhood.
In order to have an Islamic account with eToro, follow the very simple steps below:
If you've decided open an Islamic account right now with eToro, you can register via the button below so you can get started. Be sure to follow the instructions that were stated above so you can activate this specific account type.
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