Pension plan uptake soars amid growing awareness among informal workers
The CPF Individual Pension Scheme, designed for the self-employed and informal sector, posted notable performance.
An increasing number of Kenyans are embracing retirement planning, with the County Pension Fund (CPF) reporting strong growth in both membership and asset base for the year 2024.
This shift, driven by improved financial literacy and tailored pension solutions, signals a growing commitment among workers, especially in the informal sector, to secure their future.
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CPF’s active membership rose to 94,116 after registering 17,523 new members in 2024 alone.
This surge, supported by a wider sponsor base of 194 entities including county governments, agencies, and private institutions, pushed the fund’s net assets up from Sh36.97 billion in 2023 to Sh51.67 billion this year.
The CPF Individual Pension Scheme, designed for the self-employed and informal sector, posted notable performance.
Net assets jumped by 42.4 per cent, from Sh2.88 billion to Sh4.11 billion, highlighting the growing popularity of personal retirement savings plans.
“The scheme declared a 10 per cent interest rate. This growth reflects a growing awareness and appreciation of personal retirement planning, especially among the self-employed and informal sector workers,” said CPF Senior Group Executive Director Joseph Rono.
The Local Authorities Pension Trust (LAPTrust), despite being a closed scheme that does not take in new members, also reported steady growth. Net assets rose to Sh28.10 billion from Sh26.99 billion the previous year.
The number of pensioners increased to 9,655, while active membership slightly declined to 13,782 due to natural attrition.
CPF Group CEO Hosea Kili attributed the performance to sound governance and an adaptive investment approach.
“We are keenly focused on growing our schemes through prudent management and strategic investments. We will continue to work closely with the regulator and seek the invaluable support of the national government to ensure that policies are always aligned with the best interests of our members,” Kili said.
Several specialised products under CPF also showed encouraging trends. The Salih Fund, which follows Shariah-compliant principles, saw its membership rise to 9,895, although its asset base slightly decreased to Sh1.1 billion from Sh1.5 billion.
The Post-Retirement Medical Fund (PRMF), aimed at supporting retirees with medical expenses, recorded a rise in assets from Sh32.8 million to Sh55.2 million, with its membership growing to 464 from 370.
Looking ahead, CPF is investing in alternative sectors such as infrastructure. The fund is currently involved as a lead arranger and transaction advisor in projects like the Nairobi–Mombasa Expressway in partnership with Everstrong Capital, and the Talanta Stadium Asset-Backed Security Bond with Linzi Fin Co.
Policy developments have also supported this growth. CPF noted that the government’s decision to exempt retirement gratuities from tax, along with the Tax Laws (Amendment) Act, 2024, which raised tax-free contribution limits and simplified compliance, have created a more favourable environment for pension savings.
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