RBA seeks to allow members use benefits as security for mortgage

You could soon use your pension as security to buy a house through mortgage if new proposals by the Retirement Benefits Authority are adopted in their current form.

Retirement Benefits Authority Chief Executive Director Nzomo Mutuku says these are among policy reviews aimed at improving efficiency to increase uptake of pensions in Kenya.

RBA also plans to intensify awareness campaigns to push up uptake of pension services from the current 20 percent.

One such partnership is by Octagon and Alexander Forbes Kenya who announced an agreement that will see the Multinational bring international clients to Kenya’s Octagon with an 80-20 percent revenue sharing agreement.

Octagon’s Chief Executive Fred Waswa said there is a huge pensions market in Kenya that is yet to be exploited.

About 80 percent of Kenyans do not have pension covers, which is blamed on low awareness and lack of innovation blamed for the low uptake.

The RBA has been reviewing its regulations to allow members of pension schemes to utilize a portion of their accrued benefits as security for a mortgage.

The Retirements Benefits Authority is also targeting to tap those in the informal sector, most of who have shunned pension due to cost concerns and product offering.

This is by reviewing the policy and regulations to improve accessibility and ease the pension claiming process.

  

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