Wadiah yad amanah
Safekeeping on trust: the custodian holds the asset without using it and is liable only for negligence or misconduct.
Wadiah yad amanah is safekeeping based on trusteeship, which Bank Negara Malaysia's policy document describes as the inherent nature of wadiah. The custodian is not liable for loss of the asset unless caused by misconduct, negligence or breach of terms, and either party may end the contract unilaterally. Because using deposited money turns the contract into a qard under the same document, the pure form fits custody of items and documents better than bank accounts.
Sources
This entry explains a term; it is not a Shariah ruling. Approving a product is for each institution's own Shariah board and regulator.
Related terms
WadiahSafekeeping: an asset placed with a custodian to be kept and returned on demand.QardA loan of money to be repaid in an equivalent amount; any benefit stipulated for the lender is riba.Fiduciary riskThe risk that an institution fails to meet the standards that apply to its duties as trustee or manager of others' funds.