Octagon Africa has received approval from the Retirement Benefits Authority (RBA) to manage Tier II contributions from employers who opt out of the National Social Security Fund (NSSF) through the Octagon Umbrella Retirement Benefits Scheme.
“We are delighted to receive regulatory approval from RBA to manage Tier II pension contributions. Our scheme is well managed, well administered, and able to give clients better returns. In addition, our processes are highly automated,” Mr. Waswa said.
The regulatory approval is in line with the NSSF Act, 2013, which was validated and declared constitutional by the Court of Appeal in Kenya in February 2023. The Act, in Section 21, provides an opt-out option for an occupational retirement benefits scheme, an umbrella retirement benefits scheme and individual retirement benefits scheme that have been approved and registered by the RBA for purposes of receiving Tier II Contributions.
Octagon Africa Group CEO Fred Waswa said that it would be prudent for employers to put the Tier II contributions into a privately managed pension scheme such as the Octagon Umbrella Retirement Benefits Scheme which gives employers influence in the governance of the scheme through the Committees set up under the RBA Regulations.
This landmark approval comes as the Kenyan government seeks to deepen and broaden the country’s pension industry, providing more options for Kenyan workers to save for their retirement.
The pension contribution is set at 12 percent of the pensionable wages made up of two equal portions of 6 percent from the employee and 6 percent from the employer, subject to a total upper limit of Ksh2,160 for employees earning above Ksh18,000 in the first year of implementation.
Octagon Africa has been providing pension fund administration and consultancy services since 2007 and currently manages over Ksh100 billion in assets for over 200,000 customers. The company offers Employee Benefits Administration and Consultancy services.
“We believe that our expertise in pension administration, coupled with our innovative solutions, enables us to provide our clients with a unique value proposition in the Tier II pension market,” Octagon Africa Commercial Director Florence Muchiri said.
