Roshan Pension Plan

• Minimum Contribution amount is Rs. 500
• Sales loaded fee 100% waived
• An individualized pension account in customer’s name.
• Option to invest as per convenience without any risk of penalties on missing payments.
• Only up-to 1.5% Management Fee, to be charged by AMIM.

RPP provides following options to the participants to select a Pension Allocation scheme according to their requirements

• Roshan Digital Account holder (NRVA)
• Valid CNIC/NICOP/POC

NRVA holders can open Pension Account in ABL Pension Funds by visiting the following link:

https://rda.abl.com/#/customer-onboarding?customerType=RDA

Q. What is Roshan Pension Plan?

With the success of the Roshan Digital initiative and its products by Allied Bank Limited, overseas Pakistanis can now avail the benefits of investing for planning their retirement in Pakistan in Roshan Pension Plan through their very own Roshan Digital Account.

The Roshan Pension Plan (RPP) is a voluntary pension scheme run by a Pension Fund Manager who manages the voluntary contributions made by a RDA participant, whether employed or self-employed individuals or by an employer on his behalf, based on Voluntary Pension Scheme Rules, 2005. It is a saving mechanism where an individual saves from his/her current income in order to retain financial security and comfort in terms of regular income after retirement.

The RPP under a VPS is a self-contributory defined contribution pension scheme where the saving or a contribution is collected during the working life of an RDA holder and invested for profit. After the opted retirement date, the account holder is entitled to a steady monthly income from a fund built up from the earlier savings.

Q. Who is a Participant?

A Participant is an individual (NRVA holder) who has contributed or on behalf of whom contributions are made into the voluntary pension scheme.

Q. Who is the Pension Fund Manager?

Pension Fund Manager means an asset management company or a life insurance company duly authorized by the Securities and Exchange Commission of Pakistan (SECP) to efficaciously manage the contributions made by or on behalf of participants in pension fund and meet such other conditions as may be prescribed from time to time by the SECP.

Q. Is RDA Investor eligible for investment in RPP?

All Roshan Digital Account holders with NRVA having a valid CNIC/NICOP/POC and a source of income are eligible to invest in RPP.

Q. What is the minimum and maximum age limit for RPP?

Minimum age is 18 years and Maximum age is 70 years.

Q. What is ABL Mustaqbil Pension Fund/ ABL Mustaqbil Islamic Pension Fund (ABL PF/ ABL IPF)?

ABL Pension Funds (collective name for ABL PF and ABL IPF) are voluntary pension funds registered under Voluntary Pension System Rules, 2005 and managed by ABL Asset Management Company Limited (Pension Fund Manager).

Q. What is ABL Asset Management Company Limited?

Incorporated in 2007, ABL Asset Management Company Limited (ABL Funds) is registered as a Non-Banking Finance Company (NBFC) licensed by the Securities and Exchange Commission of Pakistan (SECP) to provide Asset Management and Investment Advisory services within a legal framework of the prevailing Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 and the Non-Banking Finance Companies and Notified Entities Regulations, 2008.

As an Investment Adviser, we are authorized to manage discretionary and non-discretionary portfolios for its clients. ABL Asset Management is also licensed as a Pension Fund Manager under Voluntary Pension System Rules, 2005. ABL Funds has been rated ‘AM2++’ by JCR-VIS which denotes ‘High Management Quality’.

Q. How to contribute in RPP?

NRVA holders can open Pension Account in ABL Pension Funds by visiting the following link: https://rda.abl.com/#/customer-onboarding?customerType=RDA

Q. What is the minimum initial amount to contribute?

Rs. 500/-.

In order to properly build a pension fund, one should have to first determine the amount required on a monthly basis after the time of retirement. In addition, one will have to work out how much will he/she need to set aside on a monthly basis to come with a lump sum amount large enough to create an annuity, which provides a desirable monthly income after retirement.

Q. What are the different allocation schemes in RPP?

An investment allocation scheme provides an opportunity to create a personalized retirement plan through regular contributions, with allocations adjusted according to the age & risk-taking capacity of the investor.

RPP provides following options to the participants to select a Pension Allocation scheme according to their requirements:

Q. Can I change my allocation scheme?

Yes, at any point of time during the year.

Q. In which avenues ABL Funds will invest the investor’s money?

ABL Funds will invest the pension fund money in approved equity, Income and money market instruments as laid down by the regulator and Shariah Advisor in both conventional and Shariah Compliant with the aim to provide a regular income after retirement to the Participants

Q. What is the sales load?

Sales Load fee under Roshan Pension Plan is 100% waived off.

Q. What is the backend load?

There is no Backend Load under Roshan Pension Plan/ ABL PF/ ABL IPF

Q. What is the Management fee for RPP?

Management fee is charged up to 1.5 % per annum of the net assets value of the pension fund.

Q. How is NAV calculated?

A fund’s Net Asset Value (NAV) represents the value per unit at a given point of time. The NAV is equal to the market worth of assets held in the portfolio of a Fund, minus liabilities, divided by the number of units currently issued to investors.

NAV Per Unit = (Current Market Value of all the Assets – Liabilities) / Total Number of Units Outstanding

The sales and redemption price of units might be different from the NAV if there is an element of “Sales Load / Front End Load” or “Back End Load”. The sale and redemption price is declared on a daily basis by the fund manager on its websites.

Q. What is the rate of return on the funds?

Rates of return under RPP are market driven, however, historical returns in various avenues of investment are considered for the purpose of illustrations. They can be referred from monthly Fund Manager Report (FMR) from ABL Funds’ website www.ablfunds.com

Q. What is the frequency of contribution?

The participant can contribute any time at his/ her own convenience.

Q. What is the duration of profit? Monthly, quarterly or yearly?

Profit will not be distributed to the participant; it will accumulate with the investment and after retirement participant can get the benefits. However, in case of early withdrawal of any amount it will be subject to deduction of applicable taxes.

Q. What is the maturity period for RPP?

The term of the allocation scheme would depend on the age of the investor, as the allocation scheme can mature any time between 60 and 70 years or the age which he/she will be after 25 years from the date of first contribution into a VPS; whichever comes first. However, the participant is free to redeem as and when desired, with returns up to the day of redemption and payment of tax thereon (if applicable).

Q. After maturity how will I get benefits?

All accumulated funds at the date of retirement of the participant will be available for withdrawal with the following options, namely:

• To withdraw Tax-Free up to fifty percent (50%) of the amount in his/ her individual pension account, as cash;
• To enter into a Monthly Income Payment Plan (MIPP) till the age of seventy-five years or earlier, according to an income payment allocation scheme, approved by the SECP. Disbursement of MIPP is subject to applicable Tax laws.
• To use the remaining amount to purchase an annuity from a Life Insurance Company / Family Takaful company of his/her choice.

Q. What will happen if the participant dies or becomes disabled before maturity period of RPP?

In case of death before retirement:

• All of his/ her investment will be available to the nominated survivors as per Succession Certificate issued by the Court or NADRA with the following options:
• Withdraw his/her share of the amount subject to the conditions laid down in the Income Tax Ordinance 2001;
• Transfer his/her share of the amount into his existing or new individual pension account to be opened with the Pension Fund manager,
• Use his/her share of the amount to purchase an annuity on his/her life from a Life Insurance Company, only-if his/her age is fifty- five years or more; or
• Use his/her share of the amount to purchase a deferred annuity on his/her life from a Life Insurance Company to commence at age fifty-five years or later In case of disability before retirement:
• The person will be treated as retired and will get all the benefits as on retirement

Q. In case of withdrawal more than 50%, what will be the rate of tax applied?

The withdrawal of 50% at the time of Retirement age remains tax free, however, over and above amount shall be subject to payment of tax @ of participant’s average tax rate of the preceding three years.

Q. Is it mandatory to withdraw 50% at the time of Retirement?

Not necessarily. The entire amount can be shifted for Monthly Income Payment Plan (MIPP) or 50% tax free can be withdrawn.

Q. What happened if participant withdraws/ redeems his/ her fund before retirement?

A participant at any time before retirement shall be entitled to redeem the total or part of his/her accumulation subject to payment of tax @ of his/her average tax rate of the preceding three years.

Q. Is there any limit on monthly withdrawal amount from MIPP? How is the amount determined?

Withdrawals can be made through any of these three options;

• Systematic Withdrawal Option – Under this option the Participant shall instruct the Management Company to pay a fixed amount at the end of each Period. This payment option will not be available to participants choosing Medium Volatility Option.
• Actual Appreciation Payment plus Fixed Amount – Under this option the Management Company shall calculate the amount a Participant receives based upon the actual appreciation of Participation Amount at the end of the Period plus a fixed amount. If investment depreciates during the Period, only fixed amount shall be paid to the Participant through his Participation Amount. Fixed amount shall be revisited annually to adjust for any depreciation in account balance.
• Balance to remaining number of Months Methodology – The value of total remaining balance shall be divided into the remaining number of months in the selected period. This exercise shall be undertaken at the end of each year.

Q. What if a principal participant of MIPP dies?

In case of death of the MIPP participant, the successor(s) can continue with the Plan after converting the funds under their name for remaining period. If withdrawn early the tax will be applied as per law.

Q. How Pension Funds are different from other open-end mutual funds?

Pension funds are similar to other open-end funds in terms of their returns. However, they are regulated under VPS rules while Open end funds are regulated under NBFC regulations 2008. Tax Credit is available in VPS Investment as per Section 63 of ITO 2001, for individuals who also have some source of income in Pakistan.

Q. Will Zakat be deducted at source under RPP?

State Bank of Pakistan (SBP) has clarified that Allied Roshan Digital Accounts are not subject to compulsory deduction of Zakat as per rule 24-A of the Zakat Collection & Refund Rules, 1981.

Q. How does one know that his/her investment is in safe hands?

ABL Pension Funds are managed by a leading asset management company in Pakistan – ABL Asset Management Company Limited (ABL Funds) which is a wholly owned subsidiary of Allied Bank Limited. Providing all the other benefits associated with investment in mutual funds, ABL PF and ABL IPF gives the added comfort of being supported by strong sponsors, professional fund managers, credible Shariah advisors, and a carefully selected portfolio of investments which ensure financial prudence as well as Shariah compatibility.

Q. Can the participant get physical unit certificate?

No.

Q. How frequently will the statement of accounts be sent to the participants?

E-statement is sent on each transaction and on monthly basis. However, participant can request ABL Funds for e-statement.

Q. Can the participant transfer the fund to any other pension fund manager?

Yes.

Q. Can participant change his retirement age?

Retirement age can be changed, on written request for maximum upto the age of 70 years.

Q. Can an investor open another – Pension Account after claiming retirement?

Yes, there is no restriction in VPS Rules, 2005. The Participant after retirement can open another pension account with the same Pension Fund manager or with any other Pension Fund Manager subject to that participant’s age is lesser than 70 years.