Zamara Group, which manages Sh300 billion pension funds for 170,000 Kenyans, has introduced a low-cost retirement savings product for informal sector workers.
Chief executive Sandeep Raichura said its 23-year experience in the pensions business revealed an urgent need for a low-cost product that employers could initiate for their contract and casual employees.
“Our driver, domestic workers and casual employees at our workplaces should be encouraged to save for their old-age just as we do. Make them save as low as Sh300 to Sh500 monthly into our Zamara Gift a’ Pension plan that you can voluntarily top up via our mobile phone-based premium USSD number,” he said.
Zamara’s Gift a’ Pension is the third product in the market after Octagon Africa’s Mobikeza and National Social Security Fund’s Habahaba, all voluntary savings schemes geared towards guaranteeing low-cadre workers a stress-free life in retirement.
Retirement Benefits Authority CEO Nzomo Mutuku said a conversation on voluntary savings must take place at all forums to stem a growing concern that Kenyans were living longer albeit in abject poverty.
“We urge Zamara, other pension schemes and administrators to join us in this national campaign to encourage all Kenyans to save for old age. We are at 20 percent or Sh1.2 trillion but this only covers a small fraction of formal workers,” he said.
Mr Raichura said the Gift a’ Pension plan app allows savers to calculate growth of savings enabling them to plan for financial independence after retirement.
According to Mr Mutuku, retirees should be guaranteed a happy life after retirement if they manage to have about 66 percent equivalent to their former monthly salaries as pension.
Mr Raichura said the new product will also grant savers access to a funeral benefit of up to Sh25,000 with plans underway to introduce credit lines commensurate with an individual’s savings. Beneficiaries under the plan will see contributions locked in and will be accessed as a lump sum or a pension after attaining 50 years.