Wondering what this article on halal investments is about? Here’s what it covers:
- What halal investments are?
- Benefits of halal investments?
- How you earn returns with halal investments
- How to set up a halal investment plan
You might have struggled to start a halal investment in Nigeria. The good news is, Cowrywise has you covered! With halal Investments from Lotus Capital, we’ve taken inclusive investing and financial services to a new level. By offering halal mutual funds anyone, regardless of their faith, can invest from just NGN100.
What are Halal Investments?
Halal funds present an inclusive option that allows anyone to invest, especially Muslims who adhere to the laws of their faith about earning interests.
Our partnership with Lotus Capital means it has made it easy for you to invest primarily in Sukuk Bonds, which are similar to regular bonds, Ijarah (lease agreements) and Murabaha (cost-plus arrangements). We’ve made it easy for you to invest in halal mutual funds in Nigeria.
Lotus Capital is a Nigerian Halal investment management company which was founded in 2004 and aimed to help inclusive investing in West Africa. Lotus provides financial advisory services, private wealth and asset management. They currently manage a fine portfolio that’s worth around NGN8 billion.
Are there benefits of Halal Investing in Nigeria?
One common question about Halal Investments is what the benefits of investing in this type of mutual fund are. It’s a good question, and here are some of the benefits.
- It gives everyone, including faith conscious investors, access to high earning investments.
- Halal investments undergo a lot of screening which means that the mutual funds are generally low risk.
- It also encourages investors to choose investments that are socially responsible and avoid investing in industries like alcohol, tobacco and pornography.
How do you earn returns on Halal Investments?
Currently, there are two halal fund types on Cowrywise. The Lotus Fixed Income Fund and the Lotus Halal Investment Fund. In compliance with set guidelines, the Lotus Fixed Income Fund invests in Sukuk bonds and similar medium-risk investment options. At the moment, this option offers above 12% per annum and its returns are paid quarterly to the investor.
On the other hand, the Lotus Halal Investment Fund invests in equities of firms that meet certain criteria. For instance, the fund will never invest in an alcoholic firm. Also, it does not charge a fixed management fee. The managers share profits at a sharing pattern of 70:30, 70% for you the investor and 30% for the fund manager. Interestingly, this is one of the few funds that invest in the high-performing stock of MTN Nigeria. Sounds like a deal you should try out. Learn more here.
How to set up a Halal Investment plan
1. Download the latest version of the Cowrywise app on the Playstore or Appstore.
2. Signup and create a free account. You can log in after this.
3. Tap “Actions”, followed by “Invest in Mutual Funds”.
4. Select either “Lotus Halal Fixed Income Fund” or “Lotus Halal Investment Fund” to invest in.