An investment account with an Islamic financial institution (IFI) (or broadly, a portfolio or fund) is managed by the institution or any other authorized firm (under a management agreement) in accordance with principles and rules of shari’ah, and on the basis of an agreed-upon ratio of profit-loss sharing between the institution/ firm and the accountholder. The managing firm does not bear any losses unless caused by its negligence, misconduct, or breach of contract. Otherwise, each party bears its respective share in the losses actually incurred.

Unlike conventional deposits, profit-sharing investment accounts (PSIAs) are equity investment arrangements under which profits are not guaranteed, but rather depend on the actual outcomes of investing the mobilized funds, either under a restricted (restricted PSIA) or unrestricted form (unrestricted PSIA).

Investment takes place in accordance with a shari’ah-compliant mode or more (such as mudarabah, musharakah, wakalah, etc.)