The Retirement Benefits Authority (RBA) has okayed Cytonn Asset Management Ltd (CAML) bid to manage pension scheme funds.
This was announced by the company management which indicates that there is a lot of untapped potential in the pension industry, where only 15 percent of Kenyans subscribe to.
“Despite the retirement benefits assets under management growing to about Sh1.2 trillion as of June 2018, only 15 per cent of Kenyans belong to a registered pension scheme and there is a vast opportunity to increase this,” says Cytonn Asset Managers principal officer Maurice Oduor.
This comes nine months after the Capital Markets Authority (CMA licensed CAML in March 2018. At that time, Cytonn promised to “further grow its regulated products portfolio to include fund management services for retirement benefits schemes”.
“With this licence, we look forward to adding value to the retirement benefits industry by reaching more Kenyans and enabling them to save for their retirement and securing their future,” added Oduor.
According to Zamara, a pension fund administrator, pension funds only earned 9 per cent last year.
“The entry of Cytonn into the pensions industry brings high yielding products earning up to 18 per cent p.a into the industry,” states Zamara.
Currently, there are 1,232 pension schemes in Kenya managed by 20 pension fund managers.
As compared to Kenya, the situation is different in developed countries like US where 82 per cent of those who retire rely on pension earnings. In Kenya, the number is only 15 per cent, indicating that the country has a long way to go in adopting pension schemes.
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