Consumers do not want investment choice: Danish NEST rival

The head of Danish provider NOW: Pensions has defended the scheme’s single investment strategy offering.

After its details were revealed yesterday, Tom McPhail, head of pensions research at Hargreaves Lansdown, criticised the single strategy approach, saying it left little for investors who wanted anything different such as Sharia-compliant or ethical portfolios.

However, Morten Nilsson, chief executive of NOW, said most investors will be satisfied with its simple offering.

"Consumers want as little choice as possible. They just want to hand over their investment to someone else," he said.

"Existing ethical funds do not have a huge number of savers, and our funds have high standards of social responsibility. I have never seen a well-balanced Sharia fund."

Lars Rhode, who sits on the NOW advisory board, said the investment choice offered by some pension schemes is "ridiculous" in comparison to the number of people who choose them.

NOW offers a strategy in which members accumulate savings in a managed diversified growth fund and later move into a fund that hedges the investor against annuity prices.