Idikhar Plus - Sharia Compliant Regular Savings Plan - Money Mata's Blog

Idikhar plus is a Sharia Compliant regular savings plan from Salama.

Idikhar-Plus-Savings-Plan-from-Salama-2It is ideal for individuals who wish to invest investing in Islamic Savings Plans to achieve their financial goals such as;

  • Retirement
  • Children's education
  • Property purchase
  • Starting a business, etc...

Idikhar Plus is a unit linked savings plan; investing the regular contributions of plan holders into Sharia Compliant Investment Funds of international repute.

Definition of Sharia Compliant Mutual Funds

Investopedia defines Sharia Compliant Funds as follows

An investment fund which meets all of the requirements of Shariah law and the principles articulated for "Islamic finance."

Shariah-Compliant Funds must follow a variety of rules, including investing only in Shariah-compliant companies, appointing a Shariah board, carrying out an annual Shariah audit and purifying certain prohibited types of income, such as interest, by donating them to a charity.

Like other offshore investment plans in UAE, this plan is takaful-based savings plan. However, the minimum takaful amount is set at AED 5000/-  to minimise the cost of family takaful.

Other optional riders can be added to the savings plan if necessary.

Positives of Idikhar Plus

  • Wide Choice of Investment Funds: Idikhar Plus offers a wide array of Sharia Compliant Mutual Funds from international fund houses, helping members to accumulate and grow wealth.

Salama also has the following index funds with very low management costs, to help you save and invest for your medium to long term financial goals;

Click here to access the detailed list of funds on Salama's website

You can choose up to 10 funds according to your risk appetite, growth rate expected and investment horizon. An Independent Financial Adviser can explain you more about the funds and help you construct a robust portfolio.

You can also choose pre-designed investment strategies offered by Salama for if you do not wish to select funds on our own.

Click here to know how to build a portfolio of investment funds.

  • Family Takaful Benefit - Each Plan comes with an essential family takaful benefit of AED 5,000/-, and if required the member can avail additional Takaful benefit according to his / her protection needs.
  • Choice of Regular Contribution - You can opt to pay Regular Contributions in the plan on a monthly, quarterly, half-yearly or a yearly basis. You can also invest a lump sum any time into the program.
  • Upfront Bonus Allocation - Depending on your regular contribution and the term of investment, Salama is offering an upfront bonus allocation of units on day one.

For Example: If you start a 10-year investment plan with a monthly contribution of $2,000 a month then an additional bonus allocation of $7,200 will be added to your plan on day one.

The total amount invested including your investment on day one would be $9,200 instead of $2,000. This additional bonus is an encouragement to invest a higher amount for the longer term.

  • Loyalty Bonus - The loyalty bonus is paid to reward the investors for the continued patronage with Salama. The minimum loyalty bonus is 0.25%;  payable between years 2 and 10, while the maximum bonus of 0.60% will be payable after year 16.

Challenges with the plan

Plan Charges 

It is essential to build and manage a robust portfolio of investment funds otherwise, the growth may not support the charges on the scheme. The following are the charges on the plan;

  1. Plan fees - AED 20 or USD 5.50 Per month.
  2. Takaful Charges - Depending on the Family Takaful and other optional riders selected
  3. Wakalah Fee - A percentage of Takaful Donation charged on a monthly basis. Maximum Wakalah Fee at any time during Plan Term is 15% of Takaful Donation
  4. Management Fees - 0.146 % monthly of the Fund Value or account value
  5. Establishment Charge -


Plan Year















It would be wise to invest in an Idikhar Plus plan with a short premium contribution period and remain invested as long as possible; to reduce the impact of charges.

For Eg: If you are 30 and are looking to invest for your retirement, you must ideally select a contribution term between 5 & 10 years.

By doing this, you only pay the Establishment charge for the premium contribution term only, while you can remain invested in the plan till you need the money for your retirement.

This reduces the average cost per year and also the longer you remain invested, you also qualify to get a higher loyalty bonus (See table below), thus reducing your charges further.

Plan Year

Loyalty Bonus

3rd - 10th

0.25 %

11th - 15th

0.50 %

16th onwards

0.60 %

Early Surrender Charges 

Like all regular saving plans early surrender / Full Encashment of the scheme attracts huge penalties. Many expats end up paying high surrender charges, sometimes more than 60% of the capital invested because they did not consider this aspect before signing up for the plan.

Some expats were made to believe by Unscrupulous bankers / financial advisors that they only need to pay for a short term like 13 /18 or 24 months, and they can encash the plan with the profits after that. Unfortunately, they end up losing their hard-earned savings due to the early surrender.


While there are benefits like the wide choice of Sharia funds, Allocation Bonus, Loyalty Bonus, Premium Holiday and Partial withdrawal, Idikhar plus also has various plan charges and early surrender penalties.

It is crucial to read the terms and conditions, understand the impact of charges and the possible growth of funds, before investing in the plan.

Most importantly it is very crucial to plan the premium contribution term and maturity term based on each person's individual situations.

It is better to be conservative and choose a shorter premium contribution term without getting lured by the allocation bonus.

You can arrange a Free Initial meeting with me to know if Idikhar Plus or any other Regular savings plan in UAE can help you achieve your investment goals.

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