Summary
- Financial services firm Liaison Group has launched a low-premium pensions product targeting young workers eyeing home ownership, pension and health insurance.
- The four-in-one product dubbed Liaison Mafao, will see contributions starting at Sh50 a day, where users will use their mobile phone to register as contributors as well as track performance of their savings.
- Liaison head of pensions Michael Kitau said development of Mafao follows a three-year study where 700 members drawn from various pension schemes they manage offered to participate in a ‘Mafao’ pilot with injection of Sh200 million.
Financial services firm Liaison Group has launched a low-premium
pensions product targeting young workers eyeing home ownership, pension
and health insurance.
The four-in-one product dubbed
Liaison Mafao, will see contributions starting at Sh50 a day, where
users will use their mobile phone to register as contributors as well as
track performance of their savings.
Liaison head of
pensions Michael Kitau said development of Mafao follows a three-year
study where 700 members drawn from various pension schemes they manage
offered to participate in a ‘Mafao’ pilot with 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.
Mr Kitau said
their investment’s arm was working on a ready-made housing product that
will inform future Mafao-housing needs plug-in thereby enabling Kenyans
to plan early in life based on tangible products.
Liaison Group managing director Tom Mulwa said such plans
targeting lower income earners will help address the poor savings
culture in the country that has seen many people fall into financial
problems as soon as they are no longer able to work on a daily basis.
“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,” he
said.
“Higher savings could also help Kenya get cheap
funds for development projects as opposed to the current scenario where
it has to rely on the costly donor funding.”
The
Retirement Benefits Authority, NSSF, Octagon Group and Zamara have in
the recent past all launched savings products targeting low income
earners and those working in the informal sector.
Currently, Kenyan pension funds have about Sh1.3 trillion in assets under management.
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