The National Pension Commission (PENCOM) recently introduced a
new category of fund which complies with sharia principles of
investment. The Non-Interest Fund (Fund VI) permits pension
contributors and retirees to choose the preferred investment
portfolio they would want their pension contributions remitted
to.
The Operational Framework
By the Operational Framework regulating the Fund VI,
contributions made to the fund cannot be invested in the production
or trading of alcohol, pornography, weaponry, gambling/betting,
speculation, interest earning ventures and other similar
undertakings that are contrary to Sharia principles. Furthermore,
the scope of the prohibited schemes for the Fund VI is to be
determined from time to time by the Financial Regulation Advisory
Council of Experts (FRACE), an advisory body on Islamic Banking and
Finance established by the Central Bank of Nigeria (CBN) to advice
on matters relating to Islamic commercial jurisprudence.
