Non Interest Fund – A Gold Mine Exploited by few RSA Holders
The Non Interest Fund was introduced by the National Pension Commission (PenCom) in 2021 furtherance to the implementation of the Multi-Fund Investment Structure, which seeks to provide investment portfolio choices to Retirement Savings Account holders (RSAs).
The Non-Interest Fund is an Ethical Fund and it is a gold mine that has not been exploited by many RSA holders, it is a fund that is invested in instruments that are free from speculation and uncertainty that might lead to destruction or loss of investments, the Fund is not also invested in production of alcohol, weaponry and Gambling. The Non-Interest Fund offers a viable alternative to the conventional financial instruments for pension funds investment.
The Non-Interest Fund complies with the provisions of Islamic Commercial Jurisprudence and any other established non-interest principles, as approved by the Financial Regulation Advisory Council of Experts (FRACE) or any other body constituted by the Central Bank of Nigeria and the Securities and Exchange Commission, from time to time.
The FRACE, has certified that, the Operational Framework issued by the National Pension Commission (PenCom) to Pension Fund Administrators (PFAs) for the operation of Non Interest Fund, complies with non-interest finance principles.
Performance of the Fund
The Non Interest Fund has an industry average Return on investment of 9.2% for January to 31 August 2024, which is very competitive with the performance of other Funds. The top best performing PFAs for the Non Interest Fund with Return on investment higher than the industry average are Oak Pension, CrusaderSterling Pension, ARM Pension, NLPC Pension, Access Pension, FCMB Pension and Stanbic Pension.
RSA holders in Fund I, II, III and retirees in Fund IV are eligible to move their RSA contributions to the Non-Interest Fund (Fund VI) by making a formal request to their PFA, in line with the provisions of the RSA Multi-fund Structure.
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