Minimum and maximum loan periods vary between 1 months and 10 years. Comparison interest rates vary between 6.55% and 60% p.a. Total interest repayments vary between R685.05 and R844.12 over the life of the loan. *Comparison rate is based on an unsecured loan of R20,000 for a term of 3 years. WARNING: This comparison rate is true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate. These rates can change without further notice. All rates quoted are per annum. For more information regarding fees click on "View fees & additional info +" for each product or contact the provider.
Apply for an Albaraka personal loan in South Africa
Albaraka Bank in South Africa is one of your top choices if you’re looking for an Islamic bank that follows Shari’ah law. That means you can still get your financing needs covered without sacrificing your beliefs. While Albaraka fully honours Muslim law, their doors are always open to non-Muslims who are also looking for a different banking model that works better for them.
Let’s take a look at how Albaraka Bank loans can meet your financial needs, how you can apply and other important information you need to know.
How does Albaraka Islamic Banking work?
Islamic Banking, as practised by Albaraka, has the following features:
- Shari’ah-compliant: Albaraka Bank Limited subscribes to Shari’ah law. This is Islamic law as prescribed by the Koran. Shari’ah-compliant finance shares the risks and profits equally between the bank and their client.
- No interest rates: Islamic Banking does not allow banks to make profits by charging interest. Instead of interest-bearing loans (riba), the bank charges a fee that is not dependent on the interest rate.
- Ijara: This is a lease contract where the bank buys something for you, and you rent it from them. Rent is paid per month, and at the end of the contract, you also pay the residual value of the asset in order to gain full ownership.
- Musharaka: This is a partnership or joint venture where you and the bank buy an asset or make an investment. You then share the profits and risks using percentages that you both agree on.
- Murabaha: This is cost-plus financing where the bank buys the asset, and you agree to buy it from them at a higher price. The loan payment can be made as a lump sum or in monthly instalments.
- Restricted financing: You won’t be able to get financing for any business involving pork, alcohol, tobacco, drugs and other unsuitable products.
What are the types of Albaraka personal loans?
For your personal needs, Albaraka offers the following types of finance:
Albaraka home finance
This type of loan allows you to own a house after paying a low deposit amount and zero monthly admin fees. You pay back the Albaraka loan in fixed monthly instalments. However, these instalments are to be reviewed annually. You also have an annual lump sum option, and you can receive equity on any property that you own. Furthermore, the loan comes with flexible repayment terms of up to 240 months.
Albaraka vehicle finance
The bank offers vehicle finance that requires a low deposit amount and no monthly admin fees. The advantages of an Albaraka car loan are the competitive pricing and the flexible repayment terms that go up to 72 months. In addition, you also get the option to choose an annual lump sum payment as well as fixed or variable repayments. You have to be a holder of a valid International or South African driving license to qualify for this loan.
What documents are needed to apply for an Albaraka bank loan?
- Proof of your current residential address in the form of a utility bill that is not older than 3 months;
- Salary confirmation for the last 3 months;
- If you’re non-salaried, you should provide your latest Financial Statements/Income Tax Returns;
- Bank statements for the previous 3 months;
- Government-issued, barcoded South African ID;
- A signed statement of your personal income and expenditure; and
- A signed statement of personal assets and liabilities (under your joint name if you’re married in community of property).
Use the Albaraka loan calculator to find your monthly repayments
The Albaraka loan calculator is a free tool from CompareLoan.co.za that you can use to see the estimated monthly payments for your loan. To do this, you first have to enter your loan amount and your loan term. Next, click “Calculate Repayment” for the results. If you want to get a better monthly repayment result that works well with your budget, you can change the values and try again.
Albaraka Bank has been operating since 1989. Their loan products offer a viable and long-term solution to standard and traditional banking models. With their faith-based, Shariah-compliant system, the bank focuses solely on the moral of partnership. That means when you apply for an Albaraka Bank loan, you get the best customer service that benefits both you and the bank.
Although Albaraka Bank is currently based in Durban, they have many retail branches, corporate banking, professional, and regional offices. As a bonus, Albaraka Bank Limited is an authorised financial services and credit provider, and is, therefore, reputable.
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