Pension contributors, otherwise called Retirement Savings Account (RSA) holders, will now have opportunity to increase their returns on investment through non-interest ethical fund.
The fund, also called Fund IV, having been approved on June 21, 2021, by the National Pension Commission (PenCom), was launched on Thursday by Sigma Pensions Limited.
With this fund, pension contributors concerned by religious beliefs, particularly Muslims or some ethical issues common in conventional financial products, can take advantage of the fund to enhance returns on their RSA funds.
Fund VI’s operation is consistent with the objective of the multi-fund structure, which seeks to align each RSA contributor’s beliefs, values and risk appetite with their pension fund management.
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Dave Uduanu, managing director/CEO, Sigma Pensions Limited, speaking at the launch in Abuja, said, “The launch of the Non-Interest RSA Fund VI marks another first by Sigma Pensions as it continues to trailblaze in the Nigerian Pension industry.”
According to Uduanu, this product is particularly unique because for the first time “ever in our market, it allows pension account holders to be able to have investment solutions that align with their beliefs and values.”
While thanking PenCom for opening up this window to foster financial inclusion in the country, he said, “This fund particularly seeks to invest pension savings in assets that are not interest yielding, into the production or trading of alcohol, pornography, weaponry, gambling/betting, speculation and other ventures of similar nature.
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“In the course of our market research, we discovered that worldwide, on average non-interest investments have provided better risk adjusted returns than conventional investments.”
Even in our local market, we see that non-interest investment options have provided better risk adjusted returns. Take for example, the NGX Lotus Islamic Index, since inception in 2012, has generated annualised returns of 12 percent, which compares with the NGX Pension index annualised returns of 10 percent.
According to him, Sigma Pensions has together well-crafted investment strategy to provide competitive returns to her Fund VI subscribers and invite all Nigerian pension account holders that will like their pensions managed along the principles of non-interest to choose Sigma Pensions as your trusted pension fund administrator.
Mark Collier, chairman, board of directors of Sigma Pensions, said at the launch that this product represents an epoch in the advancement towards driving greater financial inclusion among an underserved segment of the Nigerian population.
Collier said, having a vibrant non-interest pension offering will help deepen the breadth and sophistication of the domestic pension and non-pension fund management industry
“It will help drive greater financial inclusion and pension enrolment, and with the option of retirement savings products suited to non-interest preferences, it is easy to see a ready outlet for raising financial inclusion,” Collier assured.
“Fund VI would have active and retiree components and we believe it has the potential to unlock a large amount of retirement savings into non-interest instruments. In this regard, we challenge financial market regulators, market enablers and product developers to continue expanding the breadth and depth of non-interest offerings.”
Ibrahim Balarabe, executive director, Technical, Sigma Pensions, said this fund would provide a significant portion of her customers and indeed with others of similar interests but yet to join the Sigma family an opportunity to actualise their long and standing moral and spiritual yearnings and aspirations of having their pension contributions invested in a professional yet ethical manner.
With this official launch, I humble urge all those interested in being part of this fund to quickly respond to our invitation by signing their expression of interest forms and returning to any of our numerous channels of communication convenient to them.”
Balarabe promised that Sigma would continue to work and do everything within ethical, and moral and regulatory guidelines towards providing its clients with retirement as well as financial happiness.
