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SECP releases five-year comparative performance of private pension funds

Islamabad, February 02, 2018 (PPI-OT): The total net assets of the voluntary pension fund industry are currently over Rs23 billion contributed by more than 19,000 participants. The fund managers, depending on the asset class, charge the pension funds fees ranging from 0.5% to 1.5% per annum. Further, the fund managers can charge sales load up to 3% of the contribution.

However, the SECP has issued a directive restraining pension fund managers from charge sales load up to 1.5% of the contribution if an investor carries out transaction online or through website. Investors preferred Sharia-compliant pension products over conventional products. Out of Rs23 billion assets of pension funds, over 15 billion rupees are invested in Sharia-compliant pension funds.

Private pension funds were introduced in 2007 under the Voluntary Pension System Rules, 2005. At present, there are 19 pension funds operating in the market, out of which 10 are Sharia-compliant and nine are conventional. These funds are managed by ten pension fund managers who have vast experience of managing pooled investments. The pension funds provide participants with options to invest in securities and commodities. Participants can choose allocation policies suiting their risk and return preferences.

All persons holding CNIC are eligible to become members of pension funds and accumulate savings for their retired life. Tax credit of up to 20% of taxable income is also available. Moreover, persons above 40 years of age can avail even higher tax benefits. Participants have the flexibility to choose retirement age between 60 and 70 years. Upon retirement, they can withdraw up to 50% of the accumulated balance in lump sum and the remaining 50% in installments, as pension.

For more information, contact:
Head, Internal and External Communication
Securities and Exchange Commission of Pakistan (SECP)
NIC Building, 63 Jinnah Avenue, Islamabad
Tel: +92-51-9214005 or +92-51-9214009 (Ext. 378)
Fax: +92-51-9206459
Cell: +92-302-8552254
E-mail: shakil.chaudhary@secp.gov.pk
Website: www.secp.gov.pk

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