The National Pension Commission has launched a Non-Interest Fund for contributors who prefer investments in non-interest money and capital market products.
This was contained in a statement made available on its website on Thursday, where the commission stated that the non-interest fund provides an alternative to the conventional interest-based financial instruments for pension funds investment.
According to PenCom, the non-interest fund, Fund VI, complies with the provisions of Islamic law and any other established non-interest principles following regulations from the Financial Regulation Advisory Council of Experts.
The statement reads, “The Non-Interest Fund is a fund that 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 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 Commission complies with non-interest (Shari’ah) finance principles.”
The commission directed Pension Fund Administrators to create and maintain the Non-Interest Fund (Fund VI) for interested Retirement Savings Account holders.
PenCom also stated that the Non-Interest Fund would be separated into two funds for Active RSA holders and retirees, respectively.
“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 the PFA, in line with the provisions of the RSA Multi-fund Implementation Guidelines and Section 7.6 of the Investment Regulation dealing with Transfers between Fund Types within a PFA,” the statement added.