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. We also made a full assessment of eToro so you'll know if their service is right for you.
Take a look at the table of contents 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.
|☪️ Islamic Account||Available|
|💰 Minimum Deposit||$1000|
|🔛 Activation||Contact customer support|
|📝 Document Required||Proof of religion|
Want to open an eToro Islamic account now?
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The Definition of an Islamic Account
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.
Important reminder - Did You Know?
eToro has based its rules from an industry standard to offer Islamic account for traders of the Islamic faith who wish to have access to the financial market. If you really want an assurance that you are compliant with teachings or scriptures, it is highly recommended that you speak to somebody who has an extensive knowledge of the Quran.
Financial Transactions and Activities Prohibited by Sharia Law
The need for Muslim traders to use a separate Islamic Account is due to these financial activities prohibited and restricted by Sharia Law:
- Margin trading
- Overnight rollovers
- Margin deposit and interests
- Short and forward sales
No Commissions and Interest
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.
Real-Time Execution of Trades
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.
Is eToro Halal?
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.
Additional eToro Islamic Account Features
There are a few added features on the eToro Islamic Account, these are:
- Leverage trading up to 1:400
- Spreads often begins from 3 pips on EUR/USD forex pairs
- Zero-commission trading
eToro Traders from Saudi Arabia, UAE and Other Muslim Countries
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:
- Ivory Coast
- Saudi Arabia
- United Arab Emirates
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:
- Burkina Faso
- Congo (DR)
- Sierra Leone
eToro Gets the Revenue Strictly From Spreads
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.
Proof of Religion Required
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.
How to Open an Islamic Account?
In order to have an Islamic account with eToro, follow the very simple steps below:
- Open an eToro account.
First, you need to register for a real account. Enter your desired username and password, and the email that you'd like to associate with this account to sign-up.
- Verify your account by completing your profile.
Next, you will be prompted to complete your account by having providing further details and uploading a proof of ID (POI) and proof of address (POA). This will take just a few minutes to accomplish.
- Make an initial deposit of $1000 into your account.
The third step is to make a first deposit into your trading account with a minimum of $1000 using any of the payment methods that they support.
- Contact the support team to activate the Islamic account.
The last step is to get in touch with their customer support team and to request to open an Islamic account. After they have verified that you've met their requirements, they will start processing your request and you will be notified when your account is converted into an Islamic account.
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.
Ready to open your Islamic account with eToro?
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Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 78% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.
Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.
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