Islamic accounts (swap-free accounts) are special accounts without swap charges when transferring the position to the next day. The accounts were developed for Muslims, as Sharia prohibits the acceptance of specific interest or fees for loans of money for any business transaction.
History of Islamic accounts
Since the late of 1990s Muslim investors have shown great interest in Forex market. Every year, various exhibitions, conferences and trainings about electronic trading in the currency market take place in many Islamic countries. In fact, Muslim countries should be interested in the development of Forex market due to which they will strengthen their positions in the field of export-import operations, which in its turn will ensure the economic development of these countries. But some countries have a negative attitude towards Forex market considering trading in the international currency market as a violation of Sharia. The thing is that Islamic law prohibits usury, i.e. the receipt of interest by one of the parties of a financial transaction.
Islamic accounts, which exclude swap charges when transferring the position to a new value date, became the solution to the problem.
Features and advantages of Islamic accounts
- The opportunity to keep positions open without commission charges for transferring a position;
- The absence of some other commissions and interests (for example, annual interest on free margin of trader’s account) related to trading on the Forex market.
Not all brokers provide the opportunity to open Islamic accounts in the Forex market. IFC Markets meets the demands of clients adhering to their religious beliefs and gives the opportunity to open an Islamic account which has no SWAP. The company guarantees its clients transparent and secure trading environment and complete absence of additional fees.