Britam unveils pension scheme for small businesses

Britam’s Head of Financial Advisors Network Joseph Waithaka, Group Managing Director Tom Gitogo, and Britam Life General Manager Business Development Dennis Mworia celebrate winning the Life Company of the Year Award 2023 for the 17th consecutive year at the Annual Association of Kenya Insurers Awards 2023. [Courtesy]

Britam Asset Managers Kenya has unveiled a multi-employer retirement benefits scheme targeting small medium enterprises (SMEs).

The scheme called Ngao Umbrella Pension Scheme will pool funds from various employers and manage them collectively to ensure its members benefit from retirement savings.

By joining this scheme, businesses can bypass the complex and often costly process of registering a stand-alone retirement benefits scheme which is particularly advantageous for SMEs as they may find the registration requirements tedious.

The scheme’s structure as a segregated provident fund allows companies to easily join and adhere to its rules for the provision of retirement benefits to their employees.

Pooling funds from various employers enables the scheme to benefit from economies of scale, leading to higher investment returns.

This pooling nature not only ensures cost savings but also allows members to enjoy improved investment outcomes, driven by a diversified investment strategy.

Retirement planning

Ngao Umbrella Pension Scheme is already approved by the Retirement Benefits Authority for Tier 2 contributions as per the NSSF Act 2013. The scheme can also receive Tier 3 contributions.

Britam Asset Managers chief executive Barack Obatsa said the scheme is designed to support businesses in their growth journey by taking on the complex aspects of retirement planning, allowing them to focus on their core operations.

“Our aim is to ensure that every employee in Kenya has access to a secure, cost-effective retirement plan, and this scheme is a significant step towards achieving that goal,” said Mr Obatsa during the launch on Wednesday.

He said by signing up to this scheme, SMEs will not only enhance staff loyalty and retention, but will also provide a competitive package that attracts new talent.

The scheme is ideal for any registered entity with at least one employee.

Britam Asset Managers also target smaller schemes seeking to avoid the operational complexities of running a stand-alone scheme, and employers looking to enjoy the benefits of pooling resources.