Halal investment specialist Wahed Invest and independent pension provider Options UK will launch a fully-diversified Halal Workplace Pension (HWP) following burgeoning demand from British Muslims for Sharia-compatible retirement products.
The HWP - which Options and Wahed Invest claimed was the first fully Sharia-compliant halal fund in the UK - will comprise Sharia-compliant funds selected for their adherence to Muslim values. All returns from these funds, which include investments in the Islamic Global Equity Index, will be halal.
The funds' investment process also involves financial screening to ensure securities are Sharia-compliant and there are no investments in heavily indebted companies or industries including alcohol, gambling, firearms, and tobacco.
The firms said the scheme will allow British Muslims "to enjoy generous tax advantages without compromising on their beliefs".
Wahed Invest head of strategy Mehdi Benslimane said: "People are constantly reminded of the need to make their own provision for the time when they retire [and] with the launch of a diversified Sharia-compliant HWP ensures that Muslim investors have the opportunity to save for their retirement, while adhering to Islamic values."
Options UK managing director Christine Hallett added: "The launch of the UK's first HWP represents an important step in the development of the British Muslim pension market, currently valued at £47 billion.
"Moreover, this unique product also means that IFAs have a unique pension platform capable of underpinning retirement and wealth management planning within the Muslim community."
A number of pension providers offer Sharia-compliant investment products, including Nest which says its Sharia funds are "screened by Islamic scholars to make sure they meet sharia standards". Meanwhile, The People's Pension's Sharia fund "comprises Shariah-compliant companies endorsed by the HSBC Amanah Shariah Supervisory Committee".
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