Nigeria has five retail Shariah fixed income funds, and on the numbers their managers publish the Lotus Halal Fixed Income Fund is the largest at N48.31 billion, the First Asset Halal Fund shows the most recent public yield at 14.21% on 5 October 2026, and the ARM Sharia-Compliant Fixed Income Fund shows the highest holding yield at 17.89% in its August 2026 fact sheet. All five charge a 1.5% management fee. They differ on the things that decide whether the money is usable: Lotus pays quarterly with a 30-day minimum hold, Stanbic IBTC has no minimum hold and pays out in two working days, while ARM, United Capital and First Asset lock you in for 90 days and pay once or twice a year.
Ready to compare halal options?
What a Shariah fixed income fund actually holds
A Shariah fixed income fund is an open-ended SEC-registered unit trust that buys sukuk and other fixed-return Islamic contracts instead of bonds and treasury bills. Lotus describes its fund as holding sukuk plus ijarah and murabaha contracts, with no equities and no interest-bearing securities. Stanbic's mandate is a minimum of 70% sukuk and up to 30% short-term Shariah-compliant instruments. ARM's is 70% to 100% sukuk with up to 30% in Shariah-compliant fixed-term instruments and income contracts. First Asset names sukuk, ijarah, murabaha and mudarabah. The 'fixed-term instruments' in every case are placements with non-interest banks, which is how the funds hold cash without a conventional deposit.
The sukuk in question are mostly the FGN sukuk issued by the Debt Management Office, reviewed on our FGN Sukuk provider page. The income is rental under an ijarah structure rather than interest, and in 2026 it has been generous: Lotus's June 2026 fact sheet records the short-tenor SK27 sukuk yield rising to 19.78% from 17.86% during the quarter, in a market where the CBN held the Monetary Policy Rate at 26.50% in May 2026. The investing hub places these funds inside the wider halal portfolio; this page compares them with each other.
The five-fund table
Every cell comes from the manager's own product page or latest fact sheet fetched on 27 September 2026. Where a manager does not publish a figure the cell says so. Yields are not comparable like for like: First Asset quotes a daily yield on its price ticker, ARM quotes a holding yield on the portfolio, Lotus quotes realised fund returns, and Stanbic and United Capital quote no current yield on the pages we read.
| Fund | Minimum | Fee | Minimum hold or exit charge | Payout | Latest published size and date |
|---|---|---|---|---|---|
| Lotus Halal Fixed Income Fund | 5 units | 1.5% of NAV | 30 days | Quarterly; aims to pay 80% of profit | N48.31bn, 30 June 2026 |
| Stanbic IBTC Shariah Fixed Income Fund | N5,000 | 1.5% a year | None | Not stated on product page | N5.24bn, October 2025 fact sheet |
| ARM Sharia-Compliant Fixed Income Fund | N10,000 retail; N10,000,000 institutional | 1.5% of NAV plus incentive fee up to 20% of excess over benchmark | 90 days; 20% of income earned if earlier | Twice a year, cash or reinvest | N1.87bn, August 2026 |
| United Capital Sukuk Fund | N10,000; top-ups N5,000 | 1.5%; total expense ratio 1.8% | 90 days | Annually, based on performance | N4.1bn, June 2026 |
| First Asset Halal Fund | N5,000 | 1.50%; total expense ratio 1.89% | 90 days | Annually; income accrues daily | N5.70bn, fund facts page |
Two columns deserve a second look. The ARM incentive fee is unique in this group: up to 20% of any return above the fund's composite benchmark goes to the manager, and ARM's year-to-date expense ratio of 2.39% shows the all-in cost running above the headline 1.5%. The United Capital and First Asset total expense ratios of 1.8% and 1.89% are the honest numbers to compare against Lotus and Stanbic, which publish only the management fee.
Fund by fund: what each manager discloses
Lotus Halal Fixed Income Fund
The oldest and largest, launched May 2016 by Lotus Capital. The June 2026 fact sheet is the fullest disclosure in the group: a fund size of N48.31 billion, a Low risk profile, daily income accrual, 38 distributions since inception with the last in March 2026 at N39.06 per unit, Citi Bank Nigeria as custodian and STL Trustees as trustee. It reports a first-half 2026 return of 7.61% against a benchmark of 8.21%, a second-quarter return of 3.72%, a full-year 2025 return of 15.00% and an inception-to-date return of 137.52%. The current allocation was 43.39% fixed income contracts, 37.84% fixed-term investments, 17.27% sukuk and 1.50% cash, which means the fund was mostly in bank placements and ijarah or murabaha contracts rather than sukuk at the half year. The fund is reviewed annually for Shariah compliance.
Stanbic IBTC Shariah Fixed Income Fund
Launched August 2019 by Stanbic IBTC Asset Management, with a N5,000 minimum, no minimum holding period and a 1.5% fee. The product page labels the risk profile 'Aggressive', which is odd for a sukuk fund, and states that the underlying assets are subject to withholding tax. The most recent fact sheet we could locate on the site, for October 2025, showed a fund size of N5.24 billion, a unit price of N142.07 and an allocation of 71.17% sukuk and 28.83% short-term instruments, and reported average sukuk rental yields of 15.75% that month. Online redemptions pay within two working days up to N5,000,000 a day once a consent form is lodged; paper redemptions take five. Our Stanbic IBTC Shariah funds review covers the subscription route in detail.
ARM Sharia-Compliant Fixed Income Fund
The newest, launched November 2024 by ARM Investment Managers. The August 2026 fact sheet gives N1.87 billion under management, a Medium to High risk label, Rand Merchant Bank as custodian, FBNQuest Trustees as trustee, a holding yield of 17.89%, a 2025 dividend yield of 1.38%, a 2025 return of 17.17%, and an allocation of 51.76% fixed-term instruments, 45.94% sukuk and 2.31% cash. Sukuk must carry at least a BBB rating. Retail investors start at N10,000 and add from N1,000. The fact sheet mentions a Shariah advisory board without naming it.
United Capital Sukuk Fund
Started in 2020 by United Capital Asset Management. The product page lists a N10,000 initial subscription at N1 per unit, N5,000 top-ups, 24-hour redemption, a 90-day minimum holding period and an annual dividend based on performance. The June 2026 fact sheet shows N4.1 billion in size, a NAV of N1.2900 per unit, a Medium risk profile, a 1.5% management fee, a 1.8% total expense ratio and an A+(IM) investment manager rating. No current yield or holdings list is on the pages we read.
First Asset Halal Fund
Launched 4 May 2020 as the FBN Halal Fund and now run by First Asset Management, the renamed FBNQuest Asset Management. Its fund page lists a size of N5.70 billion, a N5,000 minimum, a 90-day minimum hold, daily accrual, annual distribution, a 1.50% management fee, a 1.89% total expense ratio, a Low to Medium risk profile, Standard Chartered Bank as custodian and the FGN three-year bond as benchmark. The site's price ticker on 5 October 2026 showed a bid and offer of N157.44 and a yield of 14.21%, while the fund facts table showed a NAV of N150.27 from an earlier date; the monthly commentary reports a yield to maturity of 14.29%.
Which funds disclose their holdings
None of the five publishes a line-by-line list of the sukuk it owns on the pages we fetched. Lotus and ARM publish allocation by asset class, and Lotus's quarterly fact sheets name the sukuk issues it comments on, such as SK27 and the SK31 to SK33 series. Stanbic's fact sheet shows a sukuk-versus-short-term split and says the sukuk are FGN issues. United Capital and First Asset give only the benchmark. If you want to know whether a fund holds corporate sukuk, which carry credit risk the sovereign paper does not, ask the manager for the latest portfolio report or read the audited accounts.
How these differ from balanced funds and from buying FGN Sukuk directly
A fixed income fund is not the same as the Lotus Halal Investment Fund, the Stanbic Imaan Fund or ARM's Shariah balanced fund, all of which hold screened equities and will move with the stock market. The fixed income funds do not hold shares at all, and Lotus's fact sheet says so explicitly. They are the layer for money you want back with income in one to three years, not the growth layer.
Against direct ownership, the trade is convenience for cost. Buying FGN sukuk through a stockbroker gets you the full rental with no 1.5% management fee, but in N1,000 units with a secondary market that is thin, and you must reinvest each half-yearly rental yourself. The funds pool thousands of investors, deal daily, accrue income daily and, in Lotus's case, pay out quarterly. Our sukuk fund versus direct FGN sukuk comparison runs the arithmetic on a N5,000,000 holding.
Withholding tax and what you actually receive
Stanbic states on its product page that the underlying assets are subject to withholding tax, so distributions arrive net. Lotus, ARM, United Capital and First Asset do not address tax on the pages we read. The practical consequence is that the yield a manager quotes is a gross portfolio number, and the cash you receive after tax and fees will be lower. Ask each manager for the distribution per unit actually paid in the last four quarters, which Lotus publishes (N39.06 in March 2026) and the others do not on their public pages.
How to subscribe: manager portals versus aggregators
- Lotus Capital takes subscriptions through its mobile app and by form from its Lagos, Abuja and Kano offices, with a minimum of 5 units.
- Stanbic IBTC uses an Instant Account link, the BluNest platform or a paper form at any Stanbic IBTC branch, with units issued against a transfer quoting your e-account number.
- ARM and United Capital run their own online platforms with retail minimums of N10,000 and 90-day holding periods.
- First Asset Management asks you to connect with a relationship manager from its fund page, with a N5,000 minimum.
- Cowrywise bundles the Lotus, United Capital and Marble halal fixed income funds into portfolios from N1,000, but does not carry the Stanbic, ARM or First Asset funds, as our PiggyVest, Cowrywise and Kuda check found.
The aggregator route is the cheapest way to start small and the worst way to read the fee, because the app shows a blended return. Once you hold more than a few hundred thousand naira, go direct and keep the fact sheets. The comparison tool lets you set the five funds side by side with the bank deposits they replace.
Who should choose what
For an emergency layer, the only fund in this group with no minimum holding period and a two-day online payout is Stanbic's, so it is the one to use for money you might need next month, despite its unexplained 'Aggressive' label and stale public fact sheet. For a one to three year goal such as rent, a car deposit or a wedding, Lotus is the default: the largest fund, the lowest risk label, quarterly cash and the fullest fact sheet, at the cost of a 30-day lock and a portfolio that was lighter on sukuk than its rivals at mid-2026. First Asset is the credible second choice for the same horizon if you already bank with the First group and can accept an annual payout.
For retiree income, Lotus's quarterly distribution is the practical feature; ARM's twice-yearly payout and 17.89% holding yield make it worth a share of a larger portfolio once you accept the incentive fee and the 90-day lock, and United Capital's A+ manager rating and 24-hour redemption suit a saver who wants a second manager without a second platform to learn. Anyone with more than N10,000,000 to place should split between two managers and hold some FGN sukuk directly to escape the 1.5% drag on the core. Facts checked against lotuscapitallimited.com, stanbicibtcassetmanagement.com, arm.com.ng, unitedcapitalplcgroup.com, first-assetmanagement.com on 27 September 2026.
Frequently asked questions
What is the best Shariah fixed income fund in Nigeria?
For most savers, the Lotus Halal Fixed Income Fund: at N48.31 billion it is the largest, it carries a Low risk label, it pays quarterly and its fact sheets disclose the most. Stanbic IBTC's fund is better for money you may need within weeks because it has no minimum holding period, and ARM's shows the highest published holding yield at 17.89% with a 90-day lock.
What is the minimum investment in a sukuk fund in Nigeria?
Between a few thousand naira and N10,000. Lotus accepts 5 units, Stanbic IBTC and First Asset take N5,000, and ARM and United Capital take N10,000 with top-ups from N1,000 and N5,000 respectively. Through Cowrywise the Lotus and United Capital funds are available inside portfolios from N1,000.
Do Shariah fixed income funds pay monthly income?
No. Lotus pays quarterly and aims to distribute 80% of profit; ARM pays twice a year; United Capital and First Asset pay annually; Stanbic does not state a distribution policy on its product page. All five accrue income daily into the unit price, so you can sell units to create monthly cash, subject to each fund's holding period.
Are these funds the same as buying FGN Sukuk?
No. The funds hold FGN sukuk alongside non-interest bank placements and, in some cases, corporate sukuk and ijarah or murabaha contracts, and they charge a 1.5% management fee for daily liquidity and pooled management. Buying FGN sukuk through a broker gives you the full rental with no fee but less liquidity and a reinvestment chore every six months.
Is the income from a Shariah fixed income fund taxed?
Stanbic IBTC states that its fund's underlying assets are subject to withholding tax, so distributions are paid net; the other four managers do not address tax on their fund pages. Treat any quoted yield as gross and ask the manager for the distribution per unit actually paid in the last year.
Compare providers in your state
See side-by-side comparisons of Shariah-compliant products, or let our matcher recommend the best options for your situation.
Can I lose money in a sukuk fund?
Yes, though the published records show steady gains. Unit prices fall when sukuk yields rise, as Lotus's fact sheet notes happened in the second quarter of 2026, and corporate sukuk carry issuer credit risk. ARM labels its fund Medium to High risk and Stanbic labels its 'Aggressive', while Lotus says Low; none guarantees capital.
