Overview

This product is targeted to registered pension funds that are big enough to enable, on their own, investment diversification and negotiation of favourable investment terms.

In this product, each client’s funds are held separately by a custodian appointed by the client and funds are managed independently from other pension funds and in line with the objectives set out for the fund.

Features

  1. Scheme must be registered
    For a scheme to be managed on a segregated basis, the employer needs to set up the scheme and register it with the Retirement Benefits Authority and Kenya Revenue Authority. In cases where the employer has not set up their scheme, Madison Asset can assist in this process.

  2. Funds held by a custodian
    The funds for the scheme will be held by a custodian bank appointed by the client. The custodian will ensure that funds are invested for the benefit of the scheme and are safe.
  3. Scheme to appoint trustees
    Once registered, the Scheme is considered an independent entity and must appoint trustees who will be responsible for the running of the scheme.

  4. Scheme to appoint administrator or own administrator
    The administrator will carry out the day to day administration tasks of the scheme which include, but are not limited to, keeping members records, communicating with members of the scheme, ensuring that the scheme is compliant with Retirement Benefit Authority regulations and other tasks as may be agreed with the Trustees of the Scheme. If the scheme is able, the law allows it to be own administrator.
  5. Must comply with Retirements Benefits authority  regulations
    The Scheme must comply with all regulations of the Retirement Benefit Authority that are generally intended to ensure that the funds are safe. In most cases, the Scheme Administrator and Fund Manager will advise the Trustees accordingly on compliance issues.
  6. Scheme size
    We generally advise that a Scheme have assets of more than Kshs 50 million to be managed in a segregated basis. Such amount of investment will allow the Scheme to undertake meaningful investment. For smaller schemes, we would advise a guaranteed fund.

Benefits

  1. Investment is carried out in consultation with client:
    Madison Asset will hold a quarterly meeting with the Scheme Trustees to discuss investments. In these quarterly meetings, investments for the past quarter will be discussed – including investment held and returns achieved. Also Madison Asset will agree with the Trustees on the investment for the coming quarter. This gives Trustees a say in the investment of the Scheme funds.
  2. All return achieved are for the account of client:
    All returns achieved by the Scheme investments are for the account of the Scheme and are not shared with any other party.
  3. Tax benefits:
    Members who contribute to a registered Scheme will enjoy tax deductions both on contribution to the Scheme and on return on the Scheme investments. They will enjoy further tax breaks when the finally get their benefits from the Scheme.
  4. Competitive Fees:
    Madison Asset charges a very competitive fee for the management of Scheme funds.