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Voluntary Pension Scheme (VPS)

Basics of VPS

Voluntary Pension Scheme (VPS), a retirement scheme, is a pool of investments owned by investors and managed by a licensed Pension Fund Manager. NBP Funds Pension Schemes are Voluntary Pension Schemes that facilitate individual investors to save for their retirement.

The savings you accumulate through VPS, provides you with a regular source of income (pension) after retirement to maintain your living standard and meet health and other post-retirement expenses. Pension Fund can help you to achieve the desired financial security after retirement.

Types of VPS

Types of VPS Under Voluntary Pension Schemes (VPS), NBP Funds offers its investors two pension funds namely, NAFA Pension Fund and NAFA Islamic Pension Fund. Investor can choose between the funds based on their preference. Investors contributions in VPS are invested in the underlying sub-funds namely:

  • Equity Sub-Fund: Invests in equity to achieve long-run capital appreciation and attractive returns with exposure to the volatility of the stock market
  • Debt Sub-Fund: Invests in tradeable Fixed Income securities, such as TFC’s, to provide both income and preservation of your capital
  • Money Market Sub-Fund: Invests primarily in short term Money Market instruments, such as Bank deposits, to provide a regular and stable profit stream. Investors based on their own risk and return appetite can choose an allocation which best suits them hence benefiting from personalized investment allocation. Following are the Allocation Schemes investors can choose from in Pension Funds offered by NBP Funds: “Place Allocation Scheme Table as placed in NAFA Pension Fund”

VPS REGULATIONS

Voluntary Pension System (VPS) Rules, 2005 are set up under the framework of Non- Banking Finance Companies (Establishment and Regulation) Rules, 2003.

VPS Rules requires Asset Management Companies and Life Insurance Companies to be licensed by the SECP.

Voluntary Pension System – VPS framework

It is governed by.

  • Voluntary Pension System Rules, 2005
  • Companies Act 2017
  • Income Tax Ordinance, 2001
  • NBFC Rules, 2003