Kenyans will soon access pension savings from the National Social Security Fund (NSSF) within 24 hours of laying claim, the fund’s Chief Executive Officer (CEO) David Koros has announced.
NSSF Chief Executive Officer (CEO) David Koros announced the initiative during the launch of the NSSF Corporate Strategic Plan 2023-2027 on May 7, 2024. In his address, the CEO stressed the importance of addressing long-standing claims processing delays.
“We want to provide a turnaround time to pay benefits within one day by the end of this strategic plan, which is 2027. When you claim your benefits with NSSF, we should be able to pay your benefits within 24 hours,” said the NSSF CEO.
Koros announced the ambitious initiative while responding to the revelation that a staggering 84 per cent of Kenyan adults lack social security savings, according to recent statistics.
“NSSF has been notorious for delaying claims for up to one year. We are committed to making this a thing of the past by guaranteeing that claims are processed within a day,” he added.
Mudavadi on NSSF Statistics
Also, alarming statistics emerged during the launch of the strategic plan illustrating the inadequacy of pension schemes in providing for retirees.
On his part, Prime Cabinet Secretary Musalia Mudavadi while speaking at the event stressed the worrying trend, highlighting that many Kenyan retirees find themselves struggling to make ends meet in their golden years.
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“Kenya’s retirement savings rate stands at a mere 17%, the lowest in the East Africa region. According to the KNBS, as of 2023, over 13.9 million adult Kenyans lack retirement savings,” said the PCS.
According to Mudavadi, the income replacement ratio upon retirement in Kenya is just 40%, which is way below the recommended level of 75%.
While addressing how pension funds can play a huge role in management of the country’s debts, the PCS highlighted that you NSSF could play part in financing projects and thereby reduce reliance on borrowing.
“It’s no secret that Kenya and economy that we’re managing today has got a huge debt portfolio and we know what it’s doing.
And therefore, the way the pension funds come into play, you could save us some of these issues if we work together properly, prudently,” he said.
Mudavadi further highlighted the role played by NSSF in the support of small and medium enterprises beyond its function of mobilizing local resources for national development.
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While urging Kenyans to continue saving funds, the NSSF CEO argued that saving for retirement is not a tax and called for reforms to improve the country’s savings rate as a percentage of GDP to a level of about 30%.
2027 Target
Back in 2023, the Fund had extended an invitation to all members who had pending claims to present themselves to enable prompt processing of their claims.
Koros in a statement during a meeting with the Kenya Editors Guild (KEG) also stressed the need to pay benefits within 24 hours, saying that the Fund was everything needful, including going digital and using a mobile app that will see benefits paid within a day after launching the claim.
He further said that the Fund had identified some of the priorities and rules that would enable them to run the NSSF company fairly by ensuring that they process claims in on time.
“As NSSF, we plan to recruit new members in our short-term strategy; we are working on the modalities, and once we have them finalized, we will roll them out,” said Koros.
He added that they are aiming at developing a customer-centric performance-based culture to ensure that they have a focus, thus moving their employees’ satisfaction to a level of 95 per cent.
“We want to take our services to the grassroots, to the people who are not registered as members of NSSF. This will be facilitated by digitization, which will ensure that all our records exist on digital platforms,” said the CEO.
According to him, the vision was to grow and double the fund from the current Sh300 billion to a target of Sh600 billion in three years.
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