We use two structures here, a ‘Wakalah’ (agent) account and a ‘Qard’ (loan) account. Each will come into effect depending on how much money you have deposited in your Account.
The Wakalah:
If you have deposited £1,000 or over in your Kestrl Account, then you are entering into a Wakalah agreement with Kestrl. This means that you (the customer) appoint us as the agent (or Wakeel to use the Arabic term), to manage funds in a Shariah compliant manner i.e. avoiding gambling, alcohol and interest generating activities.
Kestrl will provide an ‘expected’ return and keep anything over and above the return as an ‘incentive fee’.
The Qard:
If you have less than £1,000 in your Kestrl account, then you are entering into a Qard agreement with Kestrl. This means that you are effectively providing a loan to Kestrl, who will hold and use the money in a Shariah compliant manner and provide the full amount back to you upon request.
In both the Wakalah and the Qard agreements, the funds are being held in our safeguarding account with Maybank UK. Maybank places these funds into low risk and shariah certified assets and generates a return.
Please see the shariah certificates for each product below.
Wakalah Rewards
Qard Deposits