As consumer dissatisfaction with the UK banking sector continues, the Islamic Bank of Britain plc (IBB) has stepped up its efforts to attract consumers interested in offerings from ethical providers by launching a table-topping 4% expected profit rate for its Two Year Fixed Term Deposit (FTD) account.
The launch of the promotional rate has been timed with the start of the Muslim holy month of Ramadan and is available for 30 days from 20th July until 19th August 2012.
As an inclusive bank, IBB welcomes customers of all faiths. The minimum deposit for savers wishing to snap up the limited offer rate is £1,000. IBB is authorised and regulated by the Financial Services Authority (FSA) and is a member of the Financial Services Compensation Scheme.
As an Islamic Bank, IBB does not pay interest to its savers. Instead, this rate is offered as an ‘expected profit rate’, because the Bank invests the depositors’ funds into Sharia compliant and ethical trading activities. These activities deliver a profit over the agreed, fixed term, which in this case is 24 months.
IBB monitors the target profit rate on a daily basis to ensure it is achievable and will provide the return offered to the customer. To date, for this type of savings product, IBB has always achieved the expected profit rate offered to its customers.
IBB’s efforts to increase its appeal to consumers interested in both ethical and Sharia compliant banking has also resulted in a revamped brand positioning for the Bank of ‘Banking you can believe in’.
This is based on IBB’s faith-based values and asset-based system which offer a stable alternative to consumers of all faiths seeking a more transparent and principled approach to banking. These have also earned IBB a place in the top ten of ethical current account providers, according to ratings compiled by Ethical Consumer magazine.
Interest in ethical banking, including Islamic finance, has risen in recent weeks following public revelations and increased scrutiny over the practices and performance of conventional banks. With the Islamic holy month of Ramadan due to begin, IBB expects a further increase in interest from consumers in its products and services.
The new brand positioning is the culmination of extensive qualitative and quantitative research undertaken by IBB to further understand its core target market. Key findings from the research, below, provide detailed insight on the size, location, social and economic status of Muslim adults in the UK. This was produced for IBB in Spring 2012 by Experian, the global information services company, drawing on its data insight and analytics expertise.
The following are the top findings of the study, entitled ‘Understanding the Market, Understanding the Potential’. These are based on a combination of public, modelled and research data and estimate that:
1. The UK is home to 1, 531, 591 Muslim adults which represents 3.12% of the UK adult population
2. There are 763, 714 Muslim households in the UK, representing 3% of the UK household population
3. The highest populations of Muslim adults are in:
1) Greater London – 427, 734 Muslim adults representing 8.9% of the county’s adult population
2) Birmingham – 137, 139 Muslim adults representing 9.7% of the city’s adult population
3) City of Manchester and Oldham (both part of the Greater Manchester area) – 92, 051 Muslim adults, representing 17.37% of the combined adult population for the two areas
4) Bradford – 71, 055 Muslim adults representing 16.55% of the city’s adult population
5) Blackburn – 38, 982 Muslim adults representing 10.51% of the town’s adult population
4. The UK Muslim population is disproportionately young when compared to the UK population as a whole. 72.4% of adult Muslims are aged 18-45, compared to 51.5% of the whole UK
5. The UK Muslim population has a disproportionately high number of households with children under the age of 18 years – 72.1% of Muslim households have children under 18, compared to 40.6% for the whole UK
6. The majority of British Muslims are economically active: 59.1% are in full time employment, compared to 50.3% of the overall UK adult population, and 15.7% of Muslim adults are classed as ‘Part time/Housewife’ compared to 16.8% for the overall UK adult population
7. 49.7% of Muslim adults earn less than £20, 000 per annum (p.a.), compared to the 53.1% of UK adults overall. 43.2% earn between £20, 000 – £50, 000, compared to the 39.5% of all UK adults. 7.1% UK Muslim adults earn over £50, 000 which is similar to the overall UK picture which shows that 7.4% of adults earn in excess of this figure
8. The majority, 59.5%, of Muslim live in owner-occupied properties. This is under the figure for all UK adults which is 67.9%
IBB received its license from the Financial Services Authority in 2004 and has since attracted over 50, 000 customers. It currently provides the largest range of Sharia compliant retail financial products in the UK, which operate without the use of interest. These include Sharia compliant mortgage alternatives, the Home Purchase Plan and Buy to Let Purchase Plan, which are based on joint ownership and rent. Its savings accounts pay profits, not interest. IBB also offers personal and business banking and is available to consumers via its seven branches and agencies across the UK, as well as through telephone and internet banking.
Experian Research Methodology
Insight for Islamic Bank of Britain plc used Experian’s Mosaic Origins people classification to identify people of Muslim faith across the UK. Mosaic Origins can be used to profile areas and communities by name, origin, ethnicity and language. It classifies an individual’s first and last names according to the part of the world from which their forebears are most likely to have originated, and each name is placed into one of 200 Origins Types.
This insight was then profiled against Experian’s Consumer View database of more than 40 million UK adults, to provide rich and detailed picture of Britain’s Muslim population.
Ameinfo
