The National Social Security Fund (NSSF) has announced an interest payout of 15 per cent on members’ savings for the financial year 2017/2018.
The announcement was made by Hon. Dr. Gabriel Ajedra, State Minister of Finance for General Duties at the 6th NSSF Annual Member’s Meeting held yesterday.
The interest rate for the year equates to 1.1 trillion shillings paid out in interest to members of the Fund. This is the very first time in the Fund’s history that the Fund has declared 15% interest rate to its members.
The announcement comes on the heels of the Fund’s declaration of an impressive performance on key financial indicators for the Financial Year 2017/2018, with total income hitting a record UGX 1.6 trillion before interest to members and taxes with the fund’s total Assets Under Management (AUM) hitting a record UGX 9.98 Trillion as at June 30, 2018, a 26% increase from UGX 7.92 Trillion the previous Financial Year.
The 15% interest rate is attributed to the Fund’s improved performance on all financial and investment indicators, arising out of strategic exploitation of the investment environment within the region, despite modest growth in the economy over the same period.
The Fund’s performance shows total member contributions increased by 14% to UGX 1.05 trillion in 2017/2018 compared to UGX 917 billion in the previous Financial Year, the most ever collected by the Fund in a single year and total Income increased by 77% to UGX 1.6 Trillion in 2018 from UGX 912 Billion in 2017.
Member contributions also grew by 14% to UGX 1.05 Trillion in 2018 from UGX UGX 917 Billion in 2017 and benefits paid out to qualifying members increased by 29% to UGX 360 Billion in 2018 from UGX 278 Billion in 2017.
“These milestones can be attributed to a steady rise in compliance levels now at 81% as more members continue to trust us with their money. There was also a drive towards innovations that saw us introduce new products like the Voluntary savers scheme which attracted even more members,” said Richard Byarugaba, Managing Director, NSSF.
Byarugaba added that going by this growth, the Fund is on course to hit Ushs total assets 20 trillion by 2025 as per the 2015 – 2025 Strategic Plan outperforming all other funds and investment options.
Summary of the Fund’s 2017/2018 Performance
- The Assets Under Management (AUM) increased by 26% from UGX 7.92 Trillion in 2017 to UGX 9.98 Trillion in 2018
- Total Income increased by 77% to UGX 1.6 Trillion in 2018 from UGX 912 Billion in 2017
- Member contributions grew by 14% to UGX 1.05 Trillion in 2018 from UGX UGX 917 Billion in 2017
- Benefits paid out to qualifying members increased by 29% to UGX 360 Billion in 2018 from UGX 278 Billion in 2017
- Compliance Level rose to 81% in 2018 from 80% in 2017 leading to improved contributions
- Cost of Administration stayed flat at about 1.3%
- Cost to income ratio declined by 1% to 12.6% in 2018 from to 13.4% in 2017
The Fund has consistently paid a real and competitive return to its members over the last 6 years:
Year NSSF Interest