An NSSF staff demonstrates how SmartLife Flexi works in Owino Market recently. SmartLife Flexi is NSSF’s Voluntary savings plan developed to expand social security throughout the country. PHOTO/ FILE
National Social Security Fund (NSSF) voluntary savings have surpassed Shs5 billion in savings, just three months since its launch, driven by informal sector micro savers.
The NSSF Smartlife Flexi, lauded for its flexibility, targets mainly workers in the informal sector and self-employed. Existing NSSF members in the formal sector and non-members are also eligible to save voluntarily, according to regulations issued by the Minister of Gender, Labour and Social Development Betty Amongi.
NSSF managing director Patrick Ayota said that the uptake of the savings plan by the informal sector signifies an appetite for financial inclusion and customised savings products.
“The characteristics and needs of the informal sector are unique and different from those of a typical formal saver. The goal-based, self-driven financial and savings plans like Smartlife address the need for flexibility, affordability, and choice. That is why most of the savers on our Smartlife Flexi product are from the informal sector,” he said.
An analysis of the Smartlife Flexi portfolio reveals that about 70 percent of those enrolled are micro savers, mostly from the informal sector. About 50 percent list business as their source of savings.
Voluntary savings plan
The voluntary savings product is part of the Fund’s drive to expand social security coverage, with a strategic objective to reach about 15 million Ugandans by 2035. The Fund currently has a membership of more than 2.3 registered million savers.
Ayota added that the uptake of the new savings product underscores the public’s confidence in the Fund.
“The positive response to Smartlife Flexi is a testament to the trust Ugandans have in the Fund built over many years of consistently delivering competitive returns. Smartlife Fliexi is no different because, over the last three months since introduction, we have delivered a return above the market average,” he said.
Patrick Ayota, NSSF managing director at the launch of Smartlife Flexi in November last year. PHOTO/FILE
Put into context, the Smartlife savers earned interest rate of 12.37 percent for February, and 12.68 percent for January 2025. This is above the average interest rate for savings schemes in the retirement benefits sector which stood at 10.99 percent, according to the Uganda Retirement Benefits Regularity Authority, while return on unit trusts ranged between 10 percent and 12 percent, according to the Capital Markets Authority.
The NSSF Smartlife Voluntary Savings Plan is open to all Ugandans aged 16 and above, both within Uganda and abroad, provided they have a National Identification Number. Non-Ugandans living and working in Uganda with a valid passport and refugees in Uganda with valid identification are also eligible.
The savings plan enables income earners to save for defined periods and defined goals of their choice. It is designed on a voluntary principle that empowers a saver to choose how much to save, when to save, and for how long. Enrolled members can save for goals of a minimum of one year.
Goals
“In 2021, we conducted the NSSF Members Needs Research to guide the development of new products. The findings revealed that 60 percent of our members felt they were not saving enough and desired more voluntary options. Additionally, members expressed a need for savings solutions that address retirement planning, education, health, and capital accumulation for business ventures,” Ayota explained.
Minimum amount
The volunary savings plan minimum contribution of Shs5,000 makes it accessible to a wide audience, and returns are computed on a daily balance but credited monthly. While the minimum lock-in period is one-year, early withdrawal options are available with minimal costs, ensuring members can adapt their plans as needed.
Currently, NSSF serves about 2.3 million members, predominantly from the formal sector. However, the informal sector, which constitutes a significant portion of Uganda’s workforce and GDP contributors, remains largely excluded from traditional social security systems.
