Financial services firm Liaison Group come up with low-premium pension products targeting younger workers eyeing homeownership, health insurance, and pension.
The four-in-one products Liaison Mafao will allow contributions to start at Sh50 a day, where users will use their phones to register as contributors and track the performance of their savings.
Liaison head of pensions Michael Kitau said the development of Mafao came after a three-year study where 700 members taken from various pension schemes they manage offered to take part in the “Mafao” pilot with an injection of Sh200 million.
“We got volunteers from the 45 companies where we service pension savings. The conversation was to address pertinent issues that confound Kenyans upon retirement from age-related ailments, challenges of paying rent as well as providing cover for their cars, houses, or business and having an investment that provides them with a stipend when in retirement,” he said as reported by the Business Daily.
Kitau said the product was working on ready-made housing products that will inform Mafao-housing needs plug-in thus enabling Kenyans to make early life planning on tangible products.
According to the firm’s managing director Tom Mulwa such plans targeting lower-income earners will resolve the poor savings culture in Kenya that has seen many falls into financial difficulties as soon as they lose their jobs.In
“Only 20 percent of 17.3 million working Kenyans have some form of pension and that leaves about 14 million at risk of financial hardship upon retirement. The solution lies in a major national savings drive that informs all Kenyans on the need to have a pensions savings plan,” Mulwa noted.
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He added that higher savings could help the country acquire funds for development projects as opposed to relying on costly donor funding.
The move comes after the Retirement Benefits Authority, NSSF, Octagon Group, and Zamara launched savings products targeting low-income earners and those working in the informal sector.
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