By Silvia Nyambura
Uganda’s employment situation has changed drastically over the past few years. This means a large population of the workforce is no longer dependent on employment from large organizations but rather on small informal institutions. This, according to the National Social Security Fund (NSSF) Managing Director Richard Byarugaba presents great opportunities for the Fund to grow.
Byarugaba was addressing journalists at Workers House in Kampala this morning while launching the NSSF Voluntary Membership Plan. This new product will provide employers and workers that are not compelled by the mandatory provisions of the NSSF Act to voluntarily save for their retirement.
“We are responding to a need for a voluntary savings option by many Ugandans as well as enhancing our growth strategy in terms of membership and contributions. This plan is two pronged in that it will enable us to recruit and register voluntary employers as well as individual voluntary contributors. Under these provisions, we will recruit and register employers with less than 5 employees as well as accept contributions from former NSSF members, whom we paid their respective benefits, but are still able and willing to save with us,” he said.
Byarugaba said there is a potential customer base of close to 2 million workers who do not have any form of social security cover out of about 4 million Ugandans working in the formal sector. In addition, the informal sector employs over 11 million people, most of whom are not members of the Fund and this therefore provides a great opportunity for NSSF to widen its scope.
“We have been piloting this plan in the market since November last year and it has been well received. As at end of May 2017, we had recruited 3,017 voluntary employers and collected Ushs 2.6 billion. In addition, we recently carried out a survey and about 77% of our respondents are still interested in saving with us but they require a mid-term product they can access before retirement age,” he added.
The Fund is also set to start paying its members who qualify for their benefits through Mobile Money via its existing NSSFGO code *254# accessible to MTN and Airtel subscribers.
“Mobile Money eases reconciliation with an option of automating the upload of contributions onto members accounts, enables submission of only correct information and instant confirmation of received contributions to the member through automatic text messages. It will also provide single trip convenience to members accessing low value benefits,” Byarugaba noted.
Also in attendance, Private Sector Foundation Uganda’s (PSFU) Executive Director Gideon Badagawa said, “NSSF is not government oriented, it is about the private sector and the reason we save is so we can invest for the future. Mobilization of much needed funds for the economy through the informal sector is therefore key to our growth as a country.”
Nyambura is a senior journalist based in Kampala