National Bonds Launches New End-of-Service Savings Fund
National Bonds has unveiled a new investment option designed to enhance the UAE’s voluntary end-of-service savings scheme. This Sharia-compliant fund offers both capital protection and flexible savings, providing a modern alternative to the traditional gratuity system for employers and employees alike.
Overview of the New Fund
The “National Bonds Capital Protected Shari’a Compliant Fund” has received approval from the Ministry of Human Resources and Emiratisation, as well as the Securities and Commodities Authority. This fund represents National Bonds’ official entry into the voluntary end-of-service savings program, which was established to offer a more structured approach to long-term savings.
Employers can now invest their end-of-service contributions in approved financial instruments, while employees have the option to contribute up to 25% of their annual salary. This innovative approach aims to protect capital and deliver competitive, market-linked returns, fostering a culture of savings among the workforce. Additionally, it alleviates the risks that employers typically face with traditional end-of-service obligations.
Benefits for Employees and Employers
According to Mohammed Qasim Al Ali, Group CEO of National Bonds, this program presents significant advantages for both employees and employers. Employees can benefit from competitive investment returns that help safeguard against inflation and promote long-term financial stability. For employers, the fund offers a transparent and efficient way to manage end-of-service liabilities, enhancing their appeal in a competitive job market.
The fund is accessible through a user-friendly digital platform, allowing employees to monitor their balances and returns in real time. This feature not only empowers employees but also provides employers with a structured method to fulfill gratuity obligations and improve their overall compensation packages.
FAQs
What is the National Bonds Capital Protected Fund?
This fund is a Sharia-compliant investment option under the UAE’s voluntary end-of-service savings scheme, designed to protect capital while offering competitive returns.
How can employees contribute to the fund?
Employees can voluntarily contribute up to 25% of their annual salary to the fund, enhancing their savings for end-of-service benefits.
What advantages does this fund offer to employers?
Employers benefit from a transparent mechanism to manage end-of-service obligations, reducing associated risks and improving their attractiveness in the labor market.
Conclusion
The launch of the National Bonds Capital Protected Shari’a Compliant Fund marks a significant advancement in the UAE’s approach to end-of-service savings. By offering a secure and flexible investment option, both employees and employers can enjoy enhanced financial stability and improved management of gratuity obligations. As this initiative unfolds, it is expected to reshape the landscape of employee benefits in the region.
The introduction of the National Bonds Capital Protected Shari’a Compliant Fund aligns with the UAE’s broader economic goals, which emphasize financial literacy and responsible investing. The initiative is part of a growing trend in the region to encourage individuals to take a proactive approach to their financial futures. By providing a structured savings mechanism, the fund not only supports employees in building their wealth but also contributes to the overall economic stability of the UAE.
As the workforce in the UAE continues to diversify, the need for innovative financial products that cater to various demographics becomes increasingly important. The fund’s Sharia-compliant nature ensures that it appeals to a significant portion of the population that prioritizes ethical investing. This aspect is particularly relevant in a multicultural environment like the UAE, where many expatriates seek investment options that align with their values and beliefs.
Furthermore, the digital platform associated with the fund enhances user engagement by allowing employees to track their investments easily. This transparency fosters a sense of ownership and accountability, encouraging employees to actively participate in their financial planning. As more individuals become aware of the benefits of such savings schemes, it is anticipated that the uptake of the fund will grow, further embedding a culture of savings within the UAE workforce.
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