COLOMBO : Wadiah Gold Safe Keeping is a Shariah-compliant safekeeping facility where customers deposit their gold (jewellery or gold items) with an Islamic financial institution for secure custody. The institution keeps the gold safely in its vault and issues a certificate confirming the weight, quality, and value of the gold deposited.
Under this concept, the gold remains the property of the customer, and the financial institution acts as a trustee (Ameen) responsible for safeguarding the asset. Usually, only a nominal safekeeping fee is charged for the service.
A special feature of many Wadiah gold facilities is that the customer can use the storage certificate to obtain an interest-free cash advance (benevolent loan) when needed. In Sri Lanka, some institutions allow customers to obtain around 80%–90% of the gold value without interest, which provides liquidity while the gold remains safely stored.
In summary:
Wadiah Gold Safe Keeping is an Islamic financial solution that enables Sri Lankan Muslims to securely store their gold, access interest-free funds in emergencies, and manage their wealth in a Shariah-compliant way.
This article is written by Ash-Sheikh Zaid Nooramith, In-House Scholar Advisor (Alternate Financial Services) LOLC Finance PLC
