PensionsAug 7 2020

Options launches Sharia-compliant workplace pensions

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Options launches Sharia-compliant workplace pensions

Pension provider Options UK, formerly known as Carey Pensions, has joined forces with Halal investment specialists Wahed Invest to launch a fully diversified, Sharia-compliant workplace pension.

The new pensions offering comprises Sharia-compliant funds selected for their adherence to Muslim values and also ensures all returns from these funds are Halal.

This includes investments in Sukuk funds (Islamic Bonds), Gold and the Islamic Global Equity Index.

Sharia-compliant investing follows the belief that all natural and depletable resources should be managed for future generations. 

The investment process also involves financial screening to ensure securities are Sharia-compliant and investments in heavily indebted companies is avoided. 

In addition, Riba (interest) is neither held or received, while investing in industries including alcohol, gambling, firearms, tobacco is also forbidden.

According to Christine Hallett, managing director of Options UK, there is a noticeable gap in this market with many employees not being able to access their auto-enrolment contributions as the funds they are invested in go against their faith.

She said: "We have been involved with Sharia compliant pensions since auto-enrolment began, so this is not new to us.

“This workplace pension brings something different to the marketplace and we are the first provider to offer a completely diversified halal investment offering.

“This product also means that IFAs have a unique pension platform capable of underpinning retirement and wealth management planning within the Muslim community.” 

Ms Hallett said there was already an appetite building for this product both among the Muslim community and employers.

She added: “We have already been speaking to Islamic Finance Council and they are on board because there is nobody else who has approached a Shari-complaint pension scheme in this diverse way.”

Mehdi Benslimane, head of strategy at Wahed, said: “People are constantly reminded of the need to make their own provision for the time when they retire. Workplace pensions are one of the most tax-efficient means of doing so with the added benefit of your employer paying in as well to boost the savings amount.

“With the launch of a diversified Sharia-compliant halal workplace pension in conjunction with our master trust partners, Options UK, ensures that Muslim investors have the opportunity to save for their retirement, while adhering to Islamic values.”

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