ECONOMY: Why Uganda’s savings to GDP must rise to 25%
PERSONAL FINANCE: Free Personal Finance Tools for 2025
MEMBER STORY: How Grace doubled her voluntary savings
Big Story
6.The power of saving UGX5000 per day
Personal Finance
8. Betty Nambalirwa’s Journey to Financial Security
Big Story
10. Unpacking the New Voluntary Contributions Regulations
12. Facts And Figures
14. NSSF – an Understated Economic Driver
18. Special price offer for Solana Residences
Big interview
20. To wean herself off foreign borrowing, Uganda’s long-term savings to GDP must rise to 25%
24. Smartlife Flexi Savings hit 3 billion
25. Effective Planning Practical Tools for 2025 Sector Policy Updates
28. New Parliament
Bill seeks to reform Public Pension Scheme
Market Insights
29. Economic Developments and Outlook
Big Story
31. Empowering Savers to Take Charge of Their Financial Future
Regional Update
34. Kenya – NSSF Increases Contributions Rates
35. Rwanda Doubles Pension Contributions Rate To 12%
Personal Finance
36. How Grace Doubled Her Savings Through Voluntary Contributions
From our Research Desk
39. How to make savings second nature for many
Personal Finance
41. The 2025 Financial Literacy Program: Equipping members for successful retirement
Walking the journey of financial discovery, together.
Esteemed Readers,
With great pleasure, we introduce our quarterly social security and retirement benefits sector publication – the Savings Digest.
Over time, through our interactions with NSSF members, stakeholders, and the public, it has become obvious that there is a thirst for actionable information about financial wellness, savings, wealth management, and personal and group investments.
When we subjected these observations to research, the evidence was eye-opening. Our National Beneficiaries Survey Report showed that over 86% of the NSSF beneficiaries (an average of 43,000 people are paid annually) have heard of Financial Literacy programmes by the Fund and other financial institutions. Yet only 16.7% participated in a financial literacy program or consumed financial education content before receiving their benefits.
In addition to addressing the financial, investment, and wealth management information need, we will continue to
Whereas 86% of beneficiaries had heard of Financial Literacy Programmes by the Fund or other financial institutions, only 16% participated in such programmes, or consumed financial education content”
play a leading role in driving the overall social security/retirement benefits agenda.
The Fund is the go-to institution for anything about the sector, and through the Savings Digest, we pledge to take you along this journey with us, bringing you the latest information, research papers, innovations, and developments in the sector in Uganda and across the East African region.
Since the reforms of 2021/22 that ushered in a new legal regime for the NSSF, many stakeholders have called for further reforms, this time in the public pension space. Government seems to be moving in this direction with the new Public Pension Bill. Nonetheless, we pledge to lead the reform and policy advocacy to make the sector more responsive to the changing needs of Ugandan workers.
We dedicate our first issue to a subject closer to us – the rise of voluntary savings plans. It is gratifying to see the uptake of unit trusts skyrocket over the last 3 years. Now, Ugandans have an even better option with our NSSF Smarlife Flexi savings plan.
Our experienced and professional writers dig deeper into this phenomenon, the local and global voluntary savings trends. The universal desire for flexible savings plans across the globe is playing out in Uganda right before our eyes. My message is: if you don’t have a voluntary savings plan, do not be left behind. It doesn’t matter how much you earn, but it matters how much of your income is saved.
Finally, we look forward to hearing from you – what topical issues you are interested in, what areas you would like us to explore, and what voices you would like to hear from.
I invite you on this journey of knowledge and discovery through the Savings Digest.
Patrick M. Ayota Managing Director
Barbra Teddy Arimi Executive Editor
Joanne Bagandaswa Contributor
Victor Karamagi Editor
Carol Beyanga Consulting Editor
Paul Busharizi Contributing Editor
Tito Winyi Design Editor
Christine Kasemiire Copy Editor
John Ssenkeezi Digital Editor
Julius Businge Lead Writer
Josephine Nakitende Contributor
Stephen Omojong Contributor
Anna Maria Sanyu Contributor
The power of saving UGX5000 per day
Stephen Omojong Research & Product Development Manager
Think about it, what can UGX5000 do for you in to- day’s market? Perhaps, a well-wrapped rolex and a drink or a meal? Not much, right? Wrong.
Do you know that if you saved UGX5000 shillings a day with NSSF’s Smartlife Flexi, you could buy your dream piece of land,or make a deposit on your dream car. It is all in the power of compounding. Smartlife Flexi gives members a chance to earn daily returns on their savings while allowing them to save as frequently as
they can. The power of compounding If you started saving UGX5000 daily, you would raise UGX6.3million in 3 years.
The projections also show that savers gain more when they save for periods greater than one year because their money has more time to compound in comparison to shorter saving periods. For example, for any amount of saving, Interest will be at least 41% of the total cash out at the end of 10 years of a consistent saving journey. Interest will be 22% of the cash out for savers on a 5-year plan while it
If you started saving UGX5000 daily, you would raise UGX6.3million in 3 years.”
will form 10% of the cash out for savers on a 2-year saving plan. For instance, saving 5000 in 5 years,
would total to UGX11.8million and UGX31.3million in 10 years. Now compare with alternative saving vehicles such as real estate, animals, or any other active business. This only goes to show that there is no little money. NSSF’s Smartlife Flexi product was designed to allow members to start saving from a manageable denomination. Uganda’s domestic savings to GDP is only 11% currently, yet with initiatives like Smartlife Flexi, we can grow our savings culture.
Frequency and consistency is key Like anything in life, being consistent is associated with success. Be consistent in your actions and you will reap eventually. Our projections show that members are better off depositing more frequently earlier in their saving journey so that they have more deposits in the account to benefit from the daily compounding.
For example, saving Ugx 5,000 daily for 3 years gives a member a cash out of Ugx 6.38 million while saving an equivalent Ugx150,000 monthly for 3 years would give a member Ugx 6.30 million, a difference Ugx 80,000. Why? Because more fre-
quent deposits allow your money to compound faster. The earlier and more consistently you save, the more your money works for you. While Smartlife gives members flexibility of entry and exit, customers gain more from saving consistently for longer periods because they will accumulate a bigger deposit which will also earn more interest due to compounding for a longer period.
For more information, visit www.nssfug.org or call 0800 286 773. NSSF SmartLife—empowering Ugandans, one contribution at a time.
Smartlife Flexi provides members with flexibility and the opportunity to save as low as UGX5000. To view your projections based on your daily, monthly or annual savings, Scan the code.
KEY CONSIDERATIONS
Betty Nambalirwa’s Journey to Financial Security
Julius Businge Financial Journalist
Betty Nambalirwa is one of a number of people who represents the transformative power of disciplined financial planning through the NSSF Voluntary Savings Plan. Speaking to Julius Businge, she shared insights on her journey of preparing for retirement, achieving financial stability, and realizing her lifelong dreams. Below are excerpts from the interview:
Tell us a little bit about who you are.
I am Betty Nambalirwa, a 65-yearold retired woman. I am married and blessed with children and grandchildren. My life has been shaped by a commitment to careful planning and a desire to ensure a stable and secure future for myself and my family.
What motivated you to use the NSSF Voluntary Savings Plan for your retirement fund?
When I retired, I received my NSSF savings to work on my rental properties. This project was central to my retirement goals, as rentals would provide a consistent income stream even in old age. The NSSF Voluntary Savings Plan helped me at that time because it supplemented on my savings and helped me top up to complete my rentals. It offered a practical
way to build and supplement my savings, enabling me to meet these goals without undue financial strain.
How did you set your financial goals for retirement, and how has the plan helped you achieve them?
Growing up, my mother owned rental properties, which she used to support our family. This inspired me to pursue a similar path. I dreamed of owning rentals, recognizing that they would offer financial independence and stability, even during times when I could not be actively involved. The NSSF Voluntary Savings Plan was instrumental in turning this dream into reality. It allowed me to save consistently, ensuring that I had the funds needed to complete my rental project. Today, the income from these properties provides for my daily needs and gives me peace of mind in retirement.
What specific steps did you take to enroll in the NSSF Voluntary Savings Plan?
A friend who used to work at NSSF introduced me to the scheme and connected me with a Relationship Manager who guided me through the enrollment process. The experience was smooth and informative. Since then, I have referred several friends to the plan, many of whom have also joined and are now benefiting from it.
How did you decide on the amount to save regularly, and did you adjust this amount over time?
Initially, I planned to save UGX 100,000 per month. However, financial challenges occasionally made it difficult to maintain this amount consistently. In such instances, the plan’s flexibility allowed me to adjust my contributions based on my finan-
cial situation at the time. This adaptability ensured that I could stay on track without feeling overwhelmed. What challenges did you face while building your retirement fund, and how did you overcome them?
One of the biggest challenges was dealing with inevitable financial responsibilities, often involving third parties. These demands made it difficult to prioritize saving at times. The key to overcoming this was careful
budgeting and prioritization. While it wasn’t always easy, I learned to focus on my long-term goals and make adjustments where necessary.
How does the NSSF Voluntary Savings Plan compare to other savings or investment options you considered?
The NSSF Voluntary Savings Plan stands out for its unparalleled flexibility. Unlike many other options, it does not impose rigid timelines or penalties for irregular contributions. This makes it an ideal choice for retirees and individuals in informal employment who may have fluctuating incomes. Additionally, the plan offers a secure way to grow savings without the risks often associated with other investments.
What strategies did you use to stay consistent and disciplined in contributing to your retirement fund? Sticking to a budget was my primary strategy. Even when unexpected challenges, such as health issues, arose, I tried to maintain a disciplined approach to saving. The ability to adjust contributions during tough times also helped me stay consistent in the long run.
How has the NSSF Voluntary Savings Plan provided financial security or benefits you didn’t expect?
The plan’s tax-free interest and riskfree nature were significant benefits. Unlike other investment options, I didn’t have to worry about market fluctuations or operational challenges. Additionally, the process of withdrawing funds was straightforward. This level of convenience and security exceeded my expectations, making the plan an invaluable part of my financial strategy.
What advice would you give someone just starting to build their retirement fund using this plan?
The most important step is to get started. The NSSF Voluntary Savings Plan offers unparalleled flexibility, allowing you to save any amount at any time. This means that even small contributions can grow significantly over time, thanks to compounding interest. My advice is to set clear financial goals and begin contributing as soon as possible. With consistency and determination, the plan can help you achieve your dreams.
Looking back, what key lessons have you learned about retirement planning through the NSSF Voluntary Savings Plan?
One of the key lessons I’ve learned is the importance of flexibility. The
NSSF Voluntary Savings Plan doesn’t pressure you to save a fixed amount regularly, which is especially helpful when facing financial challenges. Withdrawals are quick and straightforward, making it ideal for retirees or those in informal employment. Above all, I’ve learned that disciplined saving, coupled with a reliable plan, is the foundation of financial independence and peace of mind.
Any last word?
My journey with the NSSF Voluntary Savings Plan has been transformative. It’s not just a savings plan— it’s a pathway to realizing dreams, weathering life’s uncertainties, and achieving financial independence. To anyone contemplating it, my message is clear - take that step. Your future self will thank you.
Betty Nambalirwa, continued saving with NSSF voluntarily even after retirement
Unpacking the New Voluntary Contributions Regulations
Joanne Bagandanswa Manager Regulatory Compliance
On 8th November 2024, the National Social Security Fund (NSSF) (Voluntary Contributions and Benefits) Regulations S.I No.91 of 2024 were gazetted in the Uganda Gazette.
Following this, the NSSF unveiled the groundbreaking regulatory framework for voluntary contributions and benefits under the banner “NSSF SmartLife.” This innovative
initiative is set to transform retirement planning by offering Ugandans flexible and accessible ways to secure their financial future.
Here’s what you need to know about the voluntary contributions and benefits regulations and how you can take advantage of it.
Who Can Apply?
Under the new regulations, anyone eligible under Section 13 of the NSSF
Act can register for voluntary contributions. Whether you’re a salaried employee or self-employed, the application process is straightforward. Simply complete Form 1 and submit it to the NSSF Managing Director (via the NSSF web or mobile app). For existing members, the Fund allows for the creation of sub-accounts dedicated to voluntary contributions.
The Managing Director is required to respond to applications within three
L-R Patrick Ayota, the Managing Director NSSF Uganda, Dr David Ogong Board Chairman and Thadeus Musoke the KACITA Chairman look on as a customer (center) opens a Smartlife Flexi account during the product launch last year.
days. Successful applicants receive a membership card (electronic or hard copy), updated to reflect their voluntary contribution status.
Flexible Contribution Options
The Regulations offer unmatched flexibility in contribution rates and schedules. Savers can contribute as little as UGX 5,000, with options for daily, weekly, monthly, quarterly, or annual payments. Payments can be made via bank deposits, mobile money, or other licensed payment systems approved by the Managing Director.
To ensure accountability and transparency, voluntary contributions are subject to accrued returns based on the Fund’s performance and prevailing market conditions.
Benefits Tailored to Your Needs
The NSSF SmartLife initiative introduces three primary benefits for members:
Programmed Withdrawal Benefits (PWB): Members who continuous-
ly contribute for at least one year are eligible for these benefits upon maturity.
Early Exit Option: Members can opt for early withdrawal after contributing for more than a year.
Refunds: Members who do not qualify for PWB or early exit can claim refunds of their contributions along with accrued returns.
Claiming benefits is hassle-free. Simply fill out Form 2 (electronically or in hard copy), provide valid identifi-
Savers can contribute as little as UGX 5,000, with options for daily, weekly, monthly, quarterly, or annual payments.”
cation, and share your bank or mobile money account details. The Fund is committed to processing and paying benefits within the timelines specified in the terms and conditions.
Transitional Provisions
Contributions made before January 7, 2022, are classified as standard contributions under the NSSF Act. Members who were registered and are making contributions after January 7, 2022, must select their contribution category within 12 months or be automatically assigned a category. This ensures smooth integration into the system and equitable benefits for all members.
Why NSSF SmartLife?
The NSSF SmartLife initiative is not just a regulatory update; it is a call to action for Ugandans to take control of their financial future. With its flexibility, transparency, and accessibility, SmartLife is designed to cater to the diverse needs of contributors, ensuring that every Ugandan can enjoy financial security during retirement.
Security for the future
You can secure your financial future by enrolling in the NSSF SmartLife program. Whether you’re new to the Fund or an existing member, the process is simple, and the benefits are unparalleled. To be part of the program, visit your nearest NSSF office or access the application forms online to get started.
For more information, visit www.nssfug.org or call 0800 286 773. NSSF SmartLife—empowering Ugandans, one contribution at a time.
The Minister of Gender, Labour and Social Development Hon Betty Amongi, issued the National Social Security Fund (Voluntary Contributions and Benefits) Regulations, 2024, (Under sections 13 (7) and 26(h) of the National Social Security Fund Act, Cap. 230). The Regulations, issued on October 24, 2024, provide for remitting, management of voluntary contributions, and payment of benefits.
Scan the code to read the detailed Regulations.
The Voluntary Contributions and Benefits Regulations S.I No.91 of 2024, were assented to by the Minister of Gender, Labour and Social Development Hon Betty Amongi, on November 8, 2024.
Over 24.2 Trillion Facts & figures
WHO WE ARE
The National Social Security Fund (NSSF) Uganda is a multi-trillion shillings Fund mandated by the Government through the NSSF Act (Cap 230) to provide social security services to all eligible employees in Uganda. It is a contributory scheme funded by contributions from employees and employers of 5% and 10%, respectively, of the employee’s gross monthly wage.
The Fund is a secure, innovative, and dynamic social security provider that guarantees safety, security, and a return on members’ savings of at least 2% above the 10-year inflation average.
Our Vision
To be the Social Security Provider of choice
Our Mission
To be a relevant partner to our members through continuous innovation in the provision of social security.
Our Purpose
To make lives better by passionately dedicating ourselves to making saving a way of life, to enable more and more people improve their wellbeing
1,219,512
8,776,488
Source: UBOS 2021
3.9%
December 2024
Over the past decade, Uganda has maintained one of the lowest and most stable inflation rates in Africa, averaging just 4.0%, the second lowest on the continent after Mauritius and lowest in the East African region.
NSSF Uganda – an Understated Economic Driver
Paul Busharizi Financial Journalist
Mr Peter Bwengye was retired at the beginning of 2020. Like the majority of National Social Security Fund (NSSF) members, his savings at the Fund constituted the major part of his savings base at retirement. On his part, his NSSF savings accounted for just over half his assets, which included his family home, some land and equi- ty positions on the stock ex- change.
Bwengye admits that without his NSSF payout, which amounted to
about five years of his gross pay, retirement would not have been an option.
He invested his money, saved over 30
years, so far affording him an income more than he was taking home in his final years of work.
Bwengye’s experience is but a microcosm of the impact the fund has had on individuals, Uganda and regional economies. A new report by audit firm KPMG has for the first time, made public an indication of the economic impact of NSSF for the last ten years to 2024.
In 2024, NSSF had 2.3 million members of whom 753,086 were active members.
Value according to the KPMG report was determined by whether NSSF activities aided Uganda’s third Na-
The National Social Security Fund Uganda Head Office at Workers House building in Kampala.
A member of NSSF Staff serves a client at the Fund offices in Kampala
The NSSF True Value Assessment is an independent, comprehensive, and verifiable evaluation of all our investments, operations, contributions, and benefit payments over the last 10 years. We are excited to share this indisputable record of the value the Fund has created as we look forward to our Vision 2035.”
Gerald Paul Kasaato, the National Social Security Fund Deputy Managing Director
tional Development Plan (NDPIII) by creating jobs, conserving the environment, improving the quality of Ugandans’ lives and whether in the final analysis it contributed to a prosperous and modern Uganda. NSSF created this value through the growth in its investments, it operations and the growth in the membership since 2014.
According to the report, NSSF created sh143.3 trillion or about 75 per-
Financial Security for Members
15,462
and equity investments are creating impact beyond our borders.
While the fixed income investments are having the most impact in Uganda, as it should be, of UGX6.7 trillion invested, more than half is in Uganda, 31 percent in Kenya, 8.9 percent in Tanzania and 0.2 percent in Rwanda.
Of the jobs created (337,779), on account of these holdings, Uganda Worth of value is created for society through providing Financial Security to NSSF members
cent of Uganda’s GDP, in total value during the period and at least two million jobs measured by Full Time Equivalent (FTE) jobs.
In and of themselves these numbers are commendable but the picture looks decidedly brighter when viewed against the situation in 2014. NSSF biggest value addition was in giving its members, like Bwengye a sense of financial security, defined as peace of mind and stability that comes from having enough money and resources to cover one’s present and future needs. KPMG estimates that NSSF has provided 7.3 times more value in 2024 than in 2014 through socio-economic improvements of its members and environmental conservation.
An average annual interest rate of
11.6 percent during the period and benefit payouts that have jumped to UGX1.1trillion from UGX166b in 2014, was used as a measure of improved financial security, from NSSF members over the last decade. NSSF makes payouts to its members in the event that, they attain retirement age at 55, shift to the public sector, relocate out of the country, are unemployed for a year after their 50th birthday, are incapacitated, or to surviving family after a member’s death. In 2022 with the amendment of the NSSF Act, an additional category of mid-term access was introduced, which allowed members to withdraw 20 percent of their money if they have saved for at least 10 years. Also job opportunities created jumped two and half times in 2024 at 346,3000 jobs compared to 138,300 in 2014, with almost all of these jobs (97.8 percent) coming from the ripple effect of NSSF investments in government and corporate paper. Interestingly, NSSF’s fixed income
NSSF TRUE VALUE ASSESSMENT
Report by KPMG
NSSF created UGX
143.3 tn
or about 75 percent of Uganda’s GDP, in total value during the period and at least two million jobs measured by Full Time Equivalent (FTE) jobs.”
The impact of investments was estimated by applying the Sustainable Investment Framework (SIF) developed by Cambridge University in the United Kingdom and the KPMG True Value Methodology. The SIF aggregates Sustainable Development Goals (SDGs) into six themes: resource security, basic needs, wellbeing, decent work, climate stability, and healthy ecosystems. Meanwhile, the KPMG True Value Methodology monetizes social, economic, and environmental impacts using standardized monetization factors as outlined by international methodologies such as the Value Balancing Alliance.
According to KPMG, the total value created over the period 2014 to 2024 by NSSF is estimated at 143.3Tn. For FY 2024, the total true value created amounted to an estimated UGX 32Tn which is 7.3 times more than the total value achieved in FY 2014.
Over the same period, an estimated total of 1,879,500 (or an annual av-
erage of 170,800) Full Time Equivalent (FTE) employment opportunities were created—these are jobs, on average, earning above the average living wage—which for Uganda is about UGX 27m a year—according to Valuing Impact`s most recently available dataset (2022). Valuing Impact is a globally recognized organization recommended by international standards, such as Value Balancing Alliance, as the provider for living wages datasets. In 2024 alone, 310,000 FTEs employment were supported by NSSF activities in line with the NDPIII goal to generate approximately 520,000 jobs a year.
Construction at the NSSF Temangalo real estate project site in Wakiso
accounted for 52 percent, Kenya 40 percent and Rwanda and Tanzania four and three percent respectively.
“The capital invested in government and corporate bonds is spent within the local economies on several economic activities, which in return contribute to additional GDP and job creation opportunities,” KPMG said in the report.
All this value was created on the back of a quantum leap in members’ savings to sh15.5trillion in 2024 from sh1.1trilion. While less dramatic, there were still corresponding movements in fixed income investments
from UGX 2.6trillion to UGX 6.7trillion; equity investments from UGX 179billion to UGX 5.8trillion; real estate investments from UGX 5billion to UGX 162billion; and the socio-economic and environmental value created through NSSF’s own operations which jumped from UGX 513bllion to UGX 3.9trillion during the same period.
When all is said and done the Fund invests a true value return of 2.1 times larger than the invested capital.
The last decade has easily been NSSF’s best years, judging by the growth in the Fund and the average annual interest it has paid its members. Being the first report of its kind on NSSF, it provides a useful benchmark for current and future administrations.
NSSF has severally reported that its cost to revenue has remained below two percent, ahead of global benchmarks, suggesting they are not only effective in growing income but doing so efficiently with little waste. There is little mention of it, but NSSF’s government paper holdings have played a crucial role in maintaining macroeconomic stability, with some of the Funds being withdrawn from the economy to manage inflationary pressures. As the biggest bond holder in the Uganda market this would be hard to ignore.
The new law has mandated that all employers, not only those with more than five workers, should sign their employees up. In addition it has opened the door to the informal sector to save voluntarily. Currently the informal sector accounts for about 80 percent of the workforce.
The above policy changes bring the Fund’s target of increasing its asset base to Sh50trillion by 2035 more realistic.
That and the testimonies of retiring members like Bwengye, should be
able to increase the NSSF’s attractiveness to members, encouraging more to join – the target is 50 percent of the workforce by 2035 compared to under a fifth currently – and for existing members to save more. What is clear though is that NSSF is and can be a powerful force for development through mobilization and deployment of resources, not only for Uganda but for the region as a whole.
NSSF impact for the last ten years up to 2024.
Report by KPMG
Created UGX 143.3 tn in total value (about 75% of Uganda’s GDP)
11.6%
Average annual interest rate
More than
2 Million Jobs Created
346,300 Job Opportunities
created in 2024 compared to 138,300 in 2014 (A two and half times jump).
97.8% coming from the ripple effect of NSSF investments in government and corporate paper.
True value return on investment 2.1 times larger than the invested capital
Distribution of Total Value Created and Job Opportunity in Uganda per asset class, accumulated 2014-2024
Agriculture, Uganda’s backbone: a woman picks tea in a tea plantation.
NSSF Offers New Year Special price for Solana Residences
Christine Kasemiire Public Relations Officer
Ugandans living in the coun- try and those abroad have an opportunity to own a home in the prestigious Solana residences for the price of USD139,000 (UGX514mil- lion).
This follows a special offer made by the real estate developer, the National Social Security Fund (NSSF), whose validity runs until the end of March 2025.
Mr Patrick Ayota, the NSSF Managing Director revealed this information. “I am pleased to inform you of the special New Year offer for the Solana Lifestyle and Residences. For the next 100 days, effective December 25th, we are offering a special starting price for units, at USD 139,000 only,” he said.
Customers can confirm their booking with a 10% down payment and move in after paying 40% of the total cost.
Located in Lubowa, off Entebbe Road, in Wakiso District, Central Uganda, Solana Lifestyle and Residences offers world-class facilities and amenities. It comprises six different communities with distinct house types including double storey villas, 3–4-bedroom bungalows, townhouses, penthouses and apartments with views of Lake Victoria.
$139,000
Solana, recognized for its sustainable green living design embodies the true definition of live, work, shop, play and stay. The modern real estate houses a lifestyle centre, communal pools and gyms, restaurants, public open spaces, children’s play areas, sporting facilities, and parks with cycle and jogging tracks. Its premium office space with ample parking is secure and convenient.
A bungalow on sale at Solana Lifestyle and Residences in Lubowa, Kampala
The Solana Lifestyle and Residences, an NSSF real estate project in Lubowa, Kampala.
To wean off foreign borrowing, Uganda’s long-term savings to GDP must rise to 25%
Victor Karamagi Senior Manager Public Relations
The NSSF recently launched a voluntary savings product, which it hopes is the start of the journey to expand social security coverage and accelerate Uganda’s long-term domestic savings to GDP. In this interview, the Fund’s Managing Director, Patrick M. Ayota, discusses why Uganda must double her longterm savings to GDP.
You have mentioned on several occasions that for Uganda’s development journey to accelerate truly, our savings to GDP must increase to at least 25%. What is magical about 25%?
For a country to achieve a certain level of economic development, many factors must be at play, and the domestic long-term savings to GDP is one of the most important. Taking the example of countries such as the East Asia giants and, lately, the Gulf states, higher domestic long-term savings to GDP contributed significantly to accelerated economic growth. Countries such as Vietnam, Singapore, Malaysia and even China began to take off economically after
their savings to GDP accelerated significantly.
The figure that has been cited severally and has been identified as the magic point, at least for case study countries such as Vietnam is 25%. In Uganda, our long-term domestic savings to GDP is only 11%, and we must strive to grow the savings rate to at least 25%. The most obvious advantage is that we can start providing most of the necessary budget support from domestically mobilized
resources, instead of relying on foreign funding that comes with very stringent and sometimes unrealistic conditions.
Vietnam is one of your favourite reference points for Uganda, why is that so?
An analysis of both Uganda and Vietnam shows that both countries were at the same level of economic development in 1986, which was the year the post-war recovery started. In addition, and more importantly, Vietnam was a mirror of Uganda in many ways at that time.
For instance, historically, both countries were agrarian societies, and both were emerging from devastating wars – the bush war for Uganda, and the American invasion and civil war in Vietnam. Both countries were major coffee (and other cash crops) exporters, both had revolutionary leadership, and, both are gifted in natural resources.
Most importantly, both countries undertook almost similar reforms
Women slope down a tea plantation in Uganda Uganda’s
“
We
are confident that by emphasizing the expansion of coverage to 50% of the working population, we can significantly contribute to increasing the savings rate.”
Patrick Ayota, the National Social Security Fund Managing Director
post-1986: both liberalized their economies to market forces, looked to attract Foreign Direct Investment (FDI), pursued a deliberate policy on value-addition and industrialization, and deliberately emphasized export-led growth policies.
Today, Uganda’s GDP is over USD 55 billion, with a savings rate of about 11% of GDP, almost exactly where Vietnam was in 2004. Vietnam GDP is about USD 550 billion with savings rate of almost 35%.The key question is: how has Vietnam experienced accelerated economic growth compared to Uganda? Both countries undertook similar reforms.One of the answers lies in mobilisation of long-term domestic savings. Vietnam began to take off economically after its long-term savings to GDP topped 25%.
The high rate of long-term domestic savings to GDP is not the only factor, but it is certainly one of the important ones. This is because it provides affordable and accessible long-term funding for key projects a government may prioritise, be it infrastructure, agriculture, etc.
What is the Fund doing as the leading mobiliser of long-term domestic savings to ensure the country achieves the Vietnam miracle?
We have developed “Vision 2035”, premised on achieving UGX 50 trillion, onboarding 50% of Uganda’s working population into the social security net, and while we do that, achieving 95% customer and staff
satisfaction. We are confident that by emphasizing the expansion of coverage to 50% of the working population, we can significantly contribute to increasing the savings rate. Our focus is on maximizing coverage and contributions by creating a willingness to save and building the capacity of Ugandans to save.
To make headway, you will see us take the lead in what you may call non-traditional areas for us, such as support to agriculture, energy development, oil and gas, if the opportunities create value for the Fund.
We are already a leader in supporting entrepreneurship through our NSSF Hi-Innovator programme where we’ve already disbursed over UGX 25 billion to 360 small and growing businesses and created over 170,000 direct and indirect jobs.
The private savings schemes are also critical, which is why we encourage Ugandans to embrace additional voluntary savings schemes along with the mandatory NSSF. Of course, there are other important policy issues the government must ensure are resolved.
What incentives should the policymakers in government and Parliament consider, to boost the savings-to-GDP?
Private sector-led growth policy does not necessarily mean that the state should leave the sector to carry the growth burden. So, the state must intervene in key sectors, especially agri-
culture – to address both the demand and supply sides. Right now, the government is focused on the supply side. Agriculture contributes over 24 percent of Uganda’s GDP, and employs over 70% of the population, so it makes sense to bring this segment of the population into the long-term savings bracket. The Fund is very keen to partner with the government for an intervention that works. Secondly, the other obvious consideration would be to change the tax regime for savings schemes like NSSF. The current regime in Uganda, where the employee contributing is taxed, the Fund’s income is taxed, and the
Agriculture in Uganda
Contributes over 24% of Uganda’s GDP
Employsover 70% of the population
Source: UBOS, MoFPED
Hanoi, the capital city of Vietnam.
benefits tax-exempt (TTE) is not the most ideal and discourages savings at the contributions stage, as well as reducing the income available for distribution to members as interest, which also does not encourage savings.
The government needs to relook at the regime and introduce the most desirable, which is EEE – tax exemption at contributions, exemptions at scheme income, and exemption at payment of benefits to members. Change of the tax regime can encourage savings across the entire sector – both NSSF and private savings schemes. In the short run one may argue that this may create a funding gap to the Treasury. However our analysis shows that the economic growth fueled by this money contributes more to the Treasury in the long run.
Secondly, the government can consider tax incentives. For instance, any additional over and above a certain contribution rate, say 15%, can be tax-exempt even with the current tax regime. Another instance is providing tax incentives for people who save for longer periods.
Excluding the UPDF and parastatals, the civil service employs just over 388,850 people, who belong to the Public Pension Scheme. Should this scheme have a role in the quest to grow our long-term domestic savings?
The simple answer is yes. However, the government needs to first accelerate the reform of the public pension scheme to make it contributory. As currently constituted under the Pensions Act, the scheme’s main challenge is sustainability mainly because it is non-contributory and, therefore, continues to suffer funding shortfalls. To cure this and to ensure it is a significant contributor to domestic long-term savings, it should be reformed so that civil servants can contribute to their pensions in addition to government contributions.
In NSSF, the government has a benchmark to follow to run a successful, profitable, and sustainable scheme. I hope the proposed reforms as envisaged in the Public Service Pension Fund Bill can be fast-tracked for the benefit of everybody and the country at large.
A lot has been said about the potential of the informal sector to drive savings rates in Uganda, where do you stand in that debate?
8,776,488
The potential is immense. The informal sector currently employs about 8,776,488, according to the UBOS National Labour Force Survey of 2021. Assuming a conservative growth rate of about 3%, you have more than 12 million employees over the next 10 years. This presents us with a huge opportunity. We have already introduced a savings product – the NSSF Smartlife Flexi, which targets the informal sector and the self-employed. Just over a month after we launched the product, over 9,000 people enrolled and contributed over Ugx 3 billion shillings, mostly from the self-employed workforce.
However, the informal sector must be assisted and incentivized to formalize and monetize the sector activities, what President Museveni calls the
“money economy”. Only then can we truly realize the potential. “I cannot save because I do not earn a good income.” Truth or myth? Many people think that because one has a very low, sporadic income, they cannot save. It is a myth. The adage that says it is not how much you earn but how much you keep rings very true in this context. Any person who earns an income, however small, can still save. You must choose between instant gratification or a better tomorrow when that rainy day comes. I would, therefore say, start by making a budget of all your expenditures in, say, a week or month. Next, review your budget and remove items that you can survive without (every budget has such items), and lastly, review one last time and retain only the essential items. By doing this simple exercise, one can discover that at whatever income level, anybody can save for that unforeseen situation. Fortunately, the NSSF Smartlife Flexi savings plan offers an opportunity for savings starting at as low as Ugx 5,000. I encourage Ugandans to visit our website, walk into any of our branches, or call us on a toll-free line 0800286773 to start a tailored savings journey.
“I am wondering whether I should open a retirement savings account given that in Uganda, people do not live long enough to benefit from their retirement savings.” Truth or myth?
This is a myth – and I can use two metrics to show how. The first is from the latest National Population and Housing Census, 2024, which shows that the overall life expectancy at birth is currently 68.2 years - 66.9 years for males and 70.1 years for females. So on average, Ugandans live to be about 70 years, yet those in formal employment retire at 55 or 60 years. You need a retirement savings plan for your old age. Secondly, looking at our data at the Fund, less than 2% of our benefits are paid to “survivors”, that is, dependents of those who passed away. Again, there is a more than 98% chance that if you save with NSSF, you will live long enough into retirement if you are in formal employment and well into old age if you are in the informal sector. A retirement savings plan is not just desirable but also a necessity.
employed in the informal sector
A farmer harvesting coffee in Vietnam
NSSF’s Smartlife Flexi registers UGX3billion in Savings
NSSF’s voluntary savings plan, Smartlife Flexi, has ex- perienced rapid growth, ac- cumulating over UGX 3 bil- lion since it started last year.
Launched on November 20th, 2024, Smartlife Flexi was introduced to increase social security coverage, targeting existing NSSF members, and non-NSSF members in the formal sector, the informal sector, and the diaspora.
As of January 2025, the product has enrolled 9,000 customers, with their combined contributions totalling UGX 3 billion.
NSSF Smartlife Flexi Savings Plan, follows the publication of the National Social Security Fund (Voluntary Contributions and Benefits) Regulations, 2024, by the Minister of Gender, Labour and Social Development Hon Betty Amongi, on November 8, 2024.
At the launch of Smartlife Flexi, NSSF Managing Director Patrick Ayota said that the NSSF Voluntary Savings Plan is borne out of the amendments to the NSSF Act that now empowers the Board to develop and introduce new products and benefits.
“The NSSF Smartlife voluntary savings plan is flexible enough to enable a saver to choose mid to long-term savings goals but also offers an oppor-
tunity for optional affordable offerings,” Ayota said.
About Smartlife Flexi
Smartlife Flexi is available to anyone aged 16 and above, including non-nationals with valid identification.
Any person can make voluntary contributions, and mandatory members can also make voluntary contributions as top-ups.
The minimum voluntary contribution is UGX 5,000, and members select the frequency of their contributions based on their preferred purpose and duration. Returns are calculated on the daily balance and credited monthly. Contributions are subject to a minimum lock-in period of one year.
A woman transacts on her phone. Smartlife Flexi has offered convenience to its customers through facilitating mobile money transfers.
Christine Kasemiire Public Relations Officer
L-R(Thadeus Musoke, the KACITA Chairman, Vanessa, the 1st Smartlife Flexi Customer, Dr David Ogong, NSSF Board Chairman, Hilda Nakagga from the Ministry of Gender, Patrick Ayota, the Managing Director NSSF, Ms Agnes Tibayeita, the Corporation Secretary NSSF and Apollo Onzoma, the Assistant Commissioner of Industrial Relations at the Ministry of Gender) pose for a photo.
Effective Planning, Practical Tips, and Top Free Personal Finance Tools for 2025
John Ssenkeezi Digital Supervisor
With the new year here, con- versations around personal goals and self-improvement are what many people are talking about or focusing on. Whether it is a desire to learn new skills, get healthier, or foster stronger personal rela- tionships, the beginning of a new year always feels ripe for change.
One area that consistently takes centre stage in goal-setting is money. The financial landscape is evolving in ways that are both exciting and challenging, leaving individuals eager to set (and keep) strong financial resolutions. Goals to save more, reduce debt, or invest intelligently are common, yet translating these ambitions
into actual achievements is easier said than done. This is because achieving financial resolutions now requires not merely good intentions but also a robust strategy. This is where careful planning and thoughtful use of modern personal finance tools become essential.
Why Planning Matters for Fi- nancial Resolutions
1. Clarity and focus
Well-defined goals allow you to focus your energies on what truly matters, ensuring that every shilling spent aligns with broader objectives. Instead of operating in a vague mental space — where you know you want to save but do not quite know how much or for what purpose — planning forc-
es you to assign tangible figures and timelines. For example, telling yourself you want to save UGX 15 million by December 2025 to fund your MBA at Makerere is far more concrete than simply saying you intend to save more. This is where products
An artistic graphic of a woman doing her finances on her computer.
like the NSSF SmartLife Flexi come in to help you name your goal and determine a savings target, frequency, and period.
2. Measurable progress
Structured plans usually incorporate specific milestones. Such milestones might include clearing a loan balance within six months or reaching a certain net worth by mid-year. These measurable markers allow you to track achievements, spot any deviations, and make the necessary adjustments before small shortcomings become large setbacks in your financial journey.
3. Resource optimisation
A detailed plan compels you to evaluate your resources carefully — time, money, and even emotional energy, and to allocate them effectively. When you budget, you are effectively deciding how to distribute your limited income across immediate necessities (rent, food), medium-term needs (emergencies, your bucketlist), and long-term goals (retirement, real estate). A structured plan ensures that you do not lose sight of any of these timelines, ensuring a more holistic approach to personal finance.
4. Accountability
Another key benefit of structured planning is the sense of accountability it forces you to have. Documenting your goals—whether in a notebook, spreadsheet, or product like the NSSF Smartlife Flexi turns them from wishes into commitments. This sense of responsibility can be further increased by sharing these commitments with a trusted friend or even family members to increase your motivation.
NSSFGo App
NSSFGo is a mobile application developed to help users plan and manage their finances with a particular focus on retirement savings and short to medium-term financial goals. By integrating loan amortisation tools, goal-based savings (SmartLife Flexi), and retirement projections, NSSFGo aims to offer both short-term and long-term financial solutions in one place. Whether you are looking to pay off a loan strategically or build an emergency fund, the app provides clear, user-friendly functionalities to keep your finances on track. Its key features include the following. Loan amortisation: This section helps you easily calculate monthly repayments, total interest, and payoff timelines for personal or home loans.
Now that you have an idea of how to plan and strategize, you will need some tools to help you keep track of your finances. Having a bird’s eye view of how you are progressing is important so that you are not working with assumptions. Here are some tools that can help.
Monarch money
Monarch Money is a comprehensive personal finance app designed to simplify financial management. It offers features like budgeting, investment tracking, net worth calculations, and goal setting, all within a user-friendly interface. It features an all-in-one dashboard that consolidates accounts, loans, and investments for a real-time financial snapshot. Customizable budgets, collaborative planning for households allows partners or family members to view, manage, and coordinate finances together. Its goal-focused tools help you set long-term targets, such as saving for a house deposit or paying off debt and monitor progress towards each milestone. Monarch’s holistic approach appeals to users seeking a complete view of their finances, making it ideal for individuals and families managing shared financial goals.
SmartLife Flexi (Goal-based Savings): This section offers flexible savings plans that align with specific life goals, from education funds to home ownership. SmartLife Flexi allows for adjustable contribution amounts and timelines, ensuring the savings process adapts to your changing financial situation.
Free Personal Finance Tools for 2025
Retirement projection: This section projects future retirement savings based on current contributions, and potential investment growth projected. The app offers goal-based and salary-based “what-if” scenarios that let you see how adjusting contribution amounts or changing retirement targets affect your final retirement fund. NSSFGo’s holistic approach sets it apart from many budgeting apps that might overlook the intricacies of social security contributions. The app is available on App Store, Google Play or web via https://nssfgo.app
YNAB (You Need a Budget)
Focused on proactive budgeting and expense tracking, YNAB helps users develop healthy financial habits by allocating income to specific categories
as soon as it arrives. This approach allows for more strategic spending and long-term financial stability. Its features include the following.
Zero-based budgeting: You allocate every shilling you earn to a specific category, ensuring you’re intentionally directing your funds.
Goal tracking: With this section, you get to define savings goals for monthly bills, holidays, or debt pay-off, and track progress clearly.
Educational resources: This includes free workshops and an active community that help build strong budgeting habits and financial literacy. Age your money: This allows you to gradually create a buffer as you aim to use money earned at least 30 days prior, thus breaking the paycheque-to-paycheque cycle.
PocketSmith
PocketSmith is a personal finance and budgeting application designed to
help individuals visualise their financial future. Unlike many conventional budgeting apps that focus primarily on historical spending, it employs a calendar-based system where you can forecast cash flow and create longterm projections, helping you make strategic decisions for savings and investments.
MoneyManager Ex
MoneyManager Ex is a free, opensource personal finance tool available on multiple platforms, including Windows, macOS, Linux, on desktops, laptops, and mobile. Known for its intuitive design and powerful tracking features, it caters to budget-conscious users seeking a versatile and reliable solution.
Here are some of its features.
Cross-platform compatibility: This allows you to use the tool on desktops, laptops, or mobile devices for seamless financial tracking.
Open-source: You can benefit from a community-driven platform that’s continually improved by contributors worldwide.
Budgeting and expense tracking: This section helps you categorise transac-
Google Sheets has become a popular tool for budgeting and expense tracking due to its simplicity, flexibility, and costfree accessibility. Its features include fully customizable spreadsheets for creating formulas, charts, and layouts tailored to track expenses, debts, and savings goals; real-time collaboration for sharing and updating sheets with others; free templates like monthly bud-
tions, set spending limits, and generate detailed reports.
Investment portfolio tracking: Keep tabs on shares, bonds, and other assets like sacco deposits to measure overall financial performance.
Choose what works best
Each finance app or platform excels in its own way — from YNAB’s robust zero-based budgeting to MoneyManager Ex’s open-source flexibility. When choosing the right tool, consider your financial goals, comfort with technology, budget, and collaboration needs. By aligning an app’s features with your personal preferences, you’ll find managing money more intuitive and rewarding.
Most apps listed here have free versions, though some require subscriptions for premium features. However, NSSFGo and MoneyManager Ex are fully available at no cost. Note that apps supporting bank account links may not work with local banks, but you can still add those accounts and mobile money wallets manually and adjust balances as needed. Needless to say, no tool can replace the expertise of a licensed financial advisor, so if you can, consult professionals to review your finances and guide you on using these tools optimally in 2025
get planners; and cloud-based access, enabling use from any device with an internet connection. Unlike subscription-based apps, Google Sheets offers unparalleled versatility, allowing users to control every aspect of their budgeting process, create custom reports, and enhance visualizations when paired with tools like Looker Studio.
New Parliament Bill seeks to reform Public Pension Scheme
Parliament of Uganda www.parliament.go.ug
The Public Service Pension Fund Bill 2024 seeks to reform the current Public Pensions Scheme by introducing a contributory aspect to mir- ror the NSSF, according to a new draft introduced by the Minister of Public Service Muruli Mukasa. The first version of the bill was withdrawn by the government in May 2023.
The Bill aims to provide for the establishment of a Public Service Pension Fund and a Public Service Pension Scheme; to provide for the gover-
nance, functions, organisation, and management of the Fund; to provide for the collection of contributions to the Fund and payment of retirement benefits to pensioners and their survivors; and to provide for the invest-
ment of the monies of the Fund and related matters.
The public service pension scheme reform from non-contributory to contributory is a key highlight of the National Development Plan IV (NDP IV) under the interventions under the Public Sector Transformation Programme.
Members will consist of public servants left with five or more years in service and all subsequent new hires. The new scheme is to be financed by employees of the public service with each worker contributing 5% of their monthly salary, which will be topped up by 10% from the employer.
The Parliament of Uganda in Kampala has tabled a bill to reform the Public Pension Scheme
Economic Developments and Outlook
Income Specialist
Statistics from (UBOS), show that year-on-year GDP growth for Q3 2024 reached 6.7%, up from 5.6% in Q3 2023/24. This improvement was primarily driven by the agriculture sector, which expanded by 8.7% compared to 4.9% in Q3 2023.
Gross Domestic Product
However, on a quarter-on-quarter basis, GDP growth slowed to 2.0% in Q3 2024, down from 2.4% in Q2 2024, largely due to a 1.1% contraction in the services sector.
The Bank of Uganda (BoU) projects GDP growth of 6.0%-6.5% for FY 2024/25 and 7.0%-7.5% over the medium term, supported by strategic government initiatives, foreign direct investment (FDI) in extractive industries, and the anticipated commencement of oil production in FY 2025/26.
Key risks to this outlook include geopolitical tensions, trade wars, and tighter domestic financial conditions. On the upside, factors such as conflict resolution, favorable weather conditions, and stronger global economic growth could further bolster performance.
Inflation
Inflation rose slightly during the quarter but remained below the central bank’s 5% target. Annual headline inflation increased to 3.3% in December 2024, up from 2.9% in both November and October, and
Josephine Nakitende Fixed
Vegetables sold in Uganda
Market Insights
3.0% in September 2024. Similarly, core inflation edged up to 3.9% in December, compared to 3.8% in November and 3.7% in September. The forecast projects average consumer price growth to rise from 3.3% in 2024 to 4% in 2025, primarily driven by imported inflation fueled by strong demand for capital goods to support the development of the oil sector.
Monetary Policy
The BoU Monetary Policy Committee (MPC) maintained an accommodative stance, lowering the Central Bank Rate (CBR) by 25 bps to 9.75% in October 2024, before holding it steady in December. This easing reflects favorable inflation projections, supported by a strong Uganda shilling, increased capital inflows, favorable commodity prices, and easing global inflation. Despite this, money markets remained tight, with commercial banks heavily reliant on central bank liquidity and rates trending at the upper end of the central bank’s corridor.
The Uganda shilling remained stable, closing at UGX 3,679.3, appreciating 0.8% year-to-date, driven by tight monetary policy, moderated outflows, and increased export revenue, especially from coffee. However, a widening current account deficit could pressure the shilling in early 2025. Strong FDI and monetary policy are expected to moderate depreciation within acceptable limits. Elections in early 2026 may amplify volatility, with sharper depreciation likely, followed by stabilization as speculative pressures ease.
Fixed Income Market
The yield curve steepened during the quarter, with long-term rates rising by 70–100 bps compared to 20–50 bps for short-term rates. Treasury auctions were oversubscribed, with an average bid-to-offer ratio of 1.98 for treasury bills and 1.62 for bonds. Average bond auction yields increased from 16% in September 2024 to 16.6% by the end of the quarter, with 10-year and 20-year bonds yielding 16.5% and 17.5%, respectively, in the final auction. These developments have enhanced the relative attractiveness of Ugandan bonds compared to regional counterparts. Looking ahead, tight interbank liquidity and rising government financing needs are expected to keep interest rates under upward pressure next quarter.
Equities
The primary stock exchanges across East Africa recorded notable gains year-to-date, reflecting the confluence of stabilizing macroeconomic conditions and a favorable dividend payout season by key listed entities. The Uganda Local Share Index
surged by 18.5% between July and December 2024, propelled primarily by the exceptional performance of MTN Uganda. The company’s robust operational results, coupled with the declaration of both its first and second interim dividends during the period, significantly bolstered investor confidence, driving share price appreciation. Similarly, the NSE All Share Index in Kenya advanced by 13.3% over the same period, underpinned by an improving macroeconomic backdrop. Key contributing factors included a stabilizing Kenyan shilling, easing monetary conditions, and enhanced business sentiment, which collectively translated into improved earnings for listed firms and subsequent share price gains. In contrast, the Tanzania Share Index (TSI) exhibited moderate growth of 3.7% from June to December 2024. This performance reflects the country’s sustained macroeconomic stability, which supported investor confidence and maintained steady equity market momentum.
Summary GDP growth for Q3 2024 6.7% December 2024 Core Inflation 3.9% UGX/USD UGX 3,679.3
Uganda Local Share Index by 18.5%
July - December 2024
NSE All Share Index13.3% July - December 2024
Tanzania Share Index (TSI) 3.7%
July - December 2024
Sylvia Mulinge, MTN Uganda CEO (left-center), hands over a UGX 39.7 billion dividend cheque to Patrick Ayota, NSSF MD (right-center), for the year ended December 2023, as Kenneth Owera, NSSF Acting CIO(right), and Andrew Bugembe, MTN CFO (left), look on.
Smartlife Flexi: Empowering Savers to Take Charge of Their Financial Future
Julius Businge Financial Journalist
November 20, 2024, will stand as a historic milestone for Uganda’s National Social Security Fund (NSSF) and its members. On this day, NSSF officially unveiled the Smartlife Savings Plan, a vol- untary savings product de- signed to revolutionize social security coverage.
This innovative solution is tailored to cater to existing NSSF members, in-
dividuals in the formal and informal sectors, and Ugandans in the diaspora, empowering them to manage their saving plans with greater flexibility and purpose.
NSSF Uganda, a multi-trillion-shilling fund mandated under the NSSF Act (Cap 230), serves as the bedrock of social security for eligible employees nationwide.
The Fund’s reputation as a secure, innovative, and dynamic institution is backed by its commitment to
safeguarding members’ savings and delivering returns that exceed Uganda’s 10-year inflation average by at least 2%. This assurance underscores the confidence members can have in products like the newly launched Smartlife Savings Plan.
The introduction of Smartlife Flexi follows the publication of the National Social Security Fund (Voluntary Contributions and Benefits) Regulations, 2024, by the Minister of Gender, Labour and Social De-
A woman browses through her phone at a vegetable stall. Smartlife is open for all people including the informal sector.
velopment, Hon. Betty Amongi, on November 8, 2024.
This regulatory framework paved the way for the NSSF Board to introduce products that address the diverse needs of savers and expand the reach of social security in Uganda.
Member-driven product
According to Patrick Ayota, Managing Director of NSSF, the Smartlife Voluntary Savings Plan is a product born out of rigorous research and a deep understanding of members’ needs.
“In 2021, we conducted the NSSF Members Needs Research to guide the development of new products. The findings revealed that 60% 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.
Smartlife Flexi is designed to address these needs with unparalleled flexibility. Members can set mid-to longterm savings goals, determine their contribution frequency, and select timelines that suit their objectives.
The product’s minimum contribution of UGX 5,000 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.
Expanding coverage
The launch of Smartlife Flexi is a cornerstone of NSSF’s broader strategy to increase social security coverage to at least 50% of Uganda’s working population by 2035.
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.
Smartlife Flexi aims to bridge this gap by targeting underserved workers and offering them an inclusive, accessible savings platform.
For NSSF, the product’s benefits extend beyond individual savers. By broadening its member base and increasing voluntary contributions, the Fund’s assets under management (AUM) are set to grow significantly. Currently valued at over UGX 23.5 trillion and invested across fixed in-
for enabling NSSF to develop innovative products like Smartlife Flexi. He emphasized that the product’s flexibility and competitive returns reflect NSSF’s proven track record in safeguarding members’ savings and ensuring long-term financial stability.
“We encourage all Ugandans to embrace this opportunity to secure their future through a trusted and reliable partner,” Dr. Ogong said.
Stakeholder support
The product’s introduction has been met with widespread support from organized groups. Dr. Thadeus Musoke, Chairman of the Kampala City Traders Association (KACITA), commended NSSF for its forward-thinking approach.
“Smartlife Flexi empowers workers to take control of their finances. Through our partnership with NSSF, we will champion this innovation to bring value to the trading community, enabling traders to build capital through consistent saving and avoid costly credit,” Musoke said.
This sentiment aligns with global best practices. Studies conducted by PwC on the UK’s National Employment Savings Trust (NEST) between 2015 and 2020 highlighted the transformative impact of flexible, user-centric savings products.
come, equities, and real estate in East Africa, these assets form the backbone of NSSF’s ambitious Vision 2035. This vision aims to grow the Fund’s assets to at least UGX 50 trillion, achieve a 95%-member satisfaction rate, and expand coverage to half of Uganda’s workforce.
Inclusive savings
Smartlife Flexi is open to all Ugandans aged 16 and above, including those in the diaspora, provided they have a National Identification Number. Non-Ugandans living and working in Uganda with valid passports and refugees with proper identification are also eligible to sign up. This inclusive approach ensures that the product caters to a diverse audience, empowering individuals to save for specific goals over defined periods while retaining complete control over their contributions.
Dr. David Ogong, Chairman of the NSSF Board, lauded the government
NEST’s innovative approach, including digital tools and behavioral economics, drove membership to over 10 million, enhanced contribution rates,
NSSF Mandatory Membership
Million Members
Dr David Ogong, NSSF Board Chairman makes his remarks at the launch of Smartlife Flexi in Kampala last year
A carpenter at work. Smartlife is open for all people including the informal sector.
and significantly improved member engagement.
Similarly, a 2020 study by the International Labour Organization (ILO) and the UN Capital Development Fund (UNCDF) underscored the potential of mobile-based micro-pension schemes in Asia and Africa. Platforms like M-Pension in Kenya and MicroPension in India reached over 2 million low-income workers, demonstrating scalability and achieving annual contribution growth rates of 20%.
As NSSF continues to innovate and grow, it invites all Ugandans to join this journey toward a stable and secure financial future.
Save smart with NSSF Smartlife Flexi and unlock the power to secure your tomorrow.
To sign up for Smartlife Flexi, follow this link and start your savings journey: https:// nssfgo.app/landing
Through our partnership with NSSF, we will champion this innovation to bring value to the trading community, enabling traders to build capital through consistent saving and avoid costly credit,”
Dr. Thadeus Musoke, Chairman,Kampala City Traders Association (KACITA)
Future resilient growth
The NSSF Smartlife Savings Plan stands as a testament to the Fund’s unwavering commitment to empowering Ugandans to take charge of their financial futures. By offering unparalleled flexibility, accessibility, and competitive returns, the product fosters a culture of proactive financial planning and ensures its members’ long-term security and peace of mind.
NSSF’s dedication to good governance and prudent management has consistently delivered safety for members’ funds while driving robust returns and asset growth.
With Smartlife Flexi, the Fund is not only expanding its reach but also strengthening its role as a cornerstone of financial resilience and self-reliance for Uganda’s workforce.
Global best practices
Studies conducted by PwC on the UK’s National Employment Savings Trust (NEST) between 2015 and 2020 highlighted the transformative impact of flexible, user-centric savings products.
NEST’s innovative approach, including digital tools and behavioral economics, drove membership to over 10 million, enhanced contribution rates, and significantly improved member engagement. Similarly, a 2020 study by the Inter-
national Labour Organization (ILO) and the UN Capital Development Fund (UNCDF) underscored the potential of mobile-based micro-pension schemes in Asia and Africa.
Platforms like M-Pension in Kenya and MicroPension in India reached over 2 million low-income workers, demonstrating scalability and achieving annual contribution growth rates of 20%.
Thadeus Musoke, the KACITA Chairman shares insights about Smartlife Flexi at the product launch in Kampala last year.
Mobile based micro-pension schemes have demonstrated the potential of scalability of social security coverage in Africa and Asia.
Kenya – NSSF Increases Contributions Rates
Adapted from Tuko News
NSSF will adjust the up- per-income limit and low- er-income limit from KSh 36,000 to KSh 72,000 and KSh 7,000 to KSh 8,000, respectively.
Kenyans earning KSh 50,000 monthly will contribute KSh 3,000 up from KSh 2,160, while employees taking home KSh 72,000 and will have KSh 4,320 deducted, up from from KSh 2,160.
Kenyans’ contribution rates to the National Social Security Fund (NSSF) are set to increase following the implementation of another phase of the rates.
The new rates, which will be implemented in February 2025, will trim employees’ pay by up to KSh 1,512. NSSF will adjust the upper- and lower-income limits from KSh 36,000 to KSh 72,000 and KSh 7,000 to KSh
8,000, respectively. According to the NSSF, Act 2013, the minimum contribution will rise from KSh 420 to KSh 480, while the highest deduction will increase from KSh 2,160 to KSh 3,840. “The lower limit earnings for the third year of implementation of the NSSF Act of 2013 will be KSh 8,000, while the upper earning limit will be two times the national average (KSh 72,000),” the Act states.
How new NSSF rates will affect payslips
Kenyans earning KSh 50,000 monthly will pay KSh 3,000, up from KSh 2,160. Business Daily reported that employees taking home KSh 72,000 and above will have KSh 4,320 deducted, up from KSh 2,160. Employers will be expected to match employee contributions, increasing the cost of doing business in Kenya.
“An employer shall pay the contribution under subsection (1) on the
ninth day of each month or on such later date as the board may, in consultation with the Cabinet secretary, prescribe,” the NSSF Act, 2013, explains.
How NSSF rates rose
The National Social Security Fund (NSSF) issued a directive to employers to implement new deductions following a landmark ruling by the Supreme Court. The Court of Appeal overturned the Employment and Labor Relations Court’s (ELRC) decision that had declared the National Social Security Act, 2013 (NSSF Act) unconstitutional. The NSSF Act had proposed increasing social security contributions from a fixed KES 400 (split equally between employee and employer) to 12% of an employee’s monthly earnings, applied on a graduated scale. Employees earning KES 18,000 or more would have seen their contributions rise to KES 2,160.
A landscape view of Kenya’s skyline
Rwanda Doubles Pension Contributions Rate To 12%
Adapted from www.rssb.rw
Savers with Rwanda’s social security provider, the Rwan- da Social Security Board (RSSB), will contribute 12%, an increase from the current 6% of their monthly salary, according to RSSB CEO Re- gis Rugemanshuro, starting this year (January 2025).
The increase is part of the ongoing reforms aimed at ensuring a sustainable pension system.
RSSB also stated that the pension will gradually increase to 20% by 2030. To facilitate a smooth transition, the increase from 12% to 20% will be implemented in 4 years with a 2% annual increase from 2027 to reach 20% in 2030.
The mandatory pension scheme requires both employers and employees to contribute equally to the employ-
ee’s pension.
Currently, the total contribution rate is set at 6% of the employee’s basic salary, with the employer contributing 3% and the employee contributing 3%.
This 6% contribution rate was established in 1962 when life expectancy was 47 years. According to the most recent census of 2022, the life expectancy in Rwanda has increased to 69 years but the rate had not been updated since then.
The changes were announced in the wake of the adoption of a Presidential Order fixing the rate of contributions for the mandatory pension scheme approved by the Rwanda Cabinet on November 9, and published in the Rwanda Official Gazette on December 13, 2024.
Presidential Order fixing the rate of contributions for the mandatory pension scheme
Modern city centre of Kigali, capital of Rwanda
Dr. Grace Kansiime Mwesigye:
‘I
saved double of what I had planned to’
Julius Businge Financial Journalist
Dr. Grace Kansiime Mwesigye, Special Presidential Assistant for Education & Sports – Infrastructure Monitoring Unit – State House, had planned to save Shs50million in two years with the NSSF Voluntary Savings Plan. Instead, she ended up saving Shs100million. She spoke to Julius Businge about how she was able to achieve this:
For starters, who is Dr. Grace Kansiime?
My name is Dr. Grace Kansiime Mwesigye, and I currently serve as the Special Presidential Assistant for Education & Sports – IMU - State House. Throughout my career, I have worked on numerous impactful projects, balancing my professional responsibilities with my aspirations. However, like many individuals, I faced the challenge of securing my financial future and ensuring a comfortable retirement. This is my journey of building my retirement fund through the NSSF Voluntary Savings Plan, a decision that transformed my financial outlook.
Tell us more about the motivation for using the NSSF Voluntary Savings Plan for your retirement fund. In March 2020, as the world shut down during the COVID-19 pan-
demic, I had just completed a significant project. The closure of this project came with a modest allowance for my efforts, and I found myself reflecting on how to make the best use of it. At the time, uncertainty loomed everywhere — jobs were scarce, and financial security felt more important than ever. It was during this period that I came across the NSSF Voluntary Savings Plan. I was motivated by its unique offering. It was a platform that not only safeguarded my money but also helped it grow over time. Unlike traditional saving methods, the NSSF scheme provided tangible benefits — growth through interest, stability, and accessibility. This combination made it an attractive option. I decided that if I was going to navigate the uncertainties of the future, I needed a plan that offered both security and growth, and NSSF was the
perfect fit. How did you set your financial goals for retirement, and how has the plan helped you achieve them? Initially, I had no concrete financial goals. Like many, any money that entered my bank account seemed to vanish almost immediately into a myriad of expenses. These ranged
from paying school fees to contributing to weddings or community fundraising events. I often found myself struggling to build any lasting financial foundation. However, in 2020, I decided to challenge myself. With inspiration from the NSSF app’s estimations, I set a goal to save UGX 50 million within two years. At the time, this felt ambitious, almost unattainable, given my track record. Yet, with disciplined saving and the motivation provided by the app’s projections, I not only met my goal but exceeded it. To my amazement, I saved over UGX 100 million within the same period. This achievement was transformative and gave me confidence in my ability to plan and save effectively for retirement.
What specific steps did you take to enroll in the NSSF Voluntary Savings Plan?
Enrolling in the NSSF Voluntary Savings Plan was surprisingly straightforward. One day, I walked into the NSSF office with an open mind, eager to find a profitable saving scheme. A gentleman named Peter approached me and noticed that I had many questions. He patiently explained the various products and benefits of the plan, addressing every concern I had with clarity and professionalism. Once I was convinced of the scheme’s value, I proceeded to register. The process was seamless — within an hour, I had my account set up. This included taking passport photos and completing the necessary paperwork. The efficiency of the process left a lasting impression on me and reaffirmed my decision to trust NSSF with my savings. How did you decide on the amount to save regularly, and did you adjust this amount over time?
The COVID-19 pandemic served as a wake-up call, making me acutely aware of the harsh realities of life without savings. Initially, I decided to save 50% of my salary. This decision required significant adjustments to my lifestyle, but I knew it was necessary. Over time, as I grew more confident in my ability to manage expenses and witnessed the growth of my savings, I began saving even more.
The NSSF app’s projections played a crucial role in motivating me to push beyond my initial limits. Seeing how small sacrifices could lead to significant growth was both encouraging and empowering. Cutting unnecessary expenses and prioritizing savings became second nature, and the results were well worth the effort.
What challenges did you face while building your retirement fund, and how did you overcome them?
One of the challenges I faced was the fact that savings in the first year did not earn interest. This initially felt like a disincentive, especially since I was accustomed to seeing immediate returns on my efforts. However, I realized that patience was key. By focusing on the long-term benefits rather than short-term gains, I stayed committed to the plan.
The support and transparency provided by NSSF also helped me remain motivated. Knowing that my money was in safe hands and would eventually yield significant returns kept me going. Over time, the interest earned on my savings became a powerful motivator, reaffirming the value of sticking with the plan.
How does the NSSF Voluntary Savings Plan compare to other savings or investment options you considered?
Having explored various savings and investment options, I can confidently say that the NSSF Voluntary Savings Plan stands out. The interest rates offered by NSSF are highly competitive, and the fund’s track record speaks for itself. Unlike other schemes that may
With inspiration from the NSSF app’s estimations, I set a goal to save UGX 50 million within two years. At the time, this felt ambitious, almost unattainable, given my track record. Yet, with disciplined saving and the motivation provided by the app’s projections, I not only met my goal but exceeded it. To my amazement, I saved over UGX 100 million within the same period.”
promise high returns but come with significant risks, NSSF provides a balanced approach, offering growth, stability, and security. Moreover, the convenience of saving through NSSF, coupled with its flexibility and accessibility, makes it an ideal choice for individuals at different income levels. The ability to save anytime, anywhere, through mobile money or standing orders further enhances its appeal. For me, these factors made it the best option among the alternatives I considered.
Dr Grace Kansiime Mwesigye inspired by NSSF’s GO App projections saved double of what she had initially planned.
What strategies did you use to stay consistent and disciplined in contributing to your retirement fund?
Consistency and discipline were critical to my success. To eliminate the temptation to spend, I set up a standing order with my bank, ensuring that a portion of my salary went directly into my NSSF account. This automated approach removed the need for willpower, making saving a priority rather than an afterthought. Additionally, I utilized mobile money to make deposits into my NSSF account whenever I had extra funds. This flexibility allowed me to save more than I had initially planned, particularly during months when I had fewer expenses. The convenience of being able to save at any time made it easier to stay on track.
How has the NSSF Voluntary Savings Plan provided financial security or benefits that you didn’t expect?
Before joining the NSSF Voluntary Savings Plan, I struggled to keep money in my account for extended periods. However, the prospect of earning interest on my savings motivated me to change my habits. Over time, the benefits of the plan exceed-
ed my expectations. One of the most significant advantages was accessing funds online when I needed them for investments or other purposes. This feature provided a sense of financial security, knowing that my money was both growing and accessible when required. The combination of growth, flexibility, and convenience has been a game-changer for me.
What advice would you give to someone just starting to build their retirement fund using this plan? They should view saving with NSSF as an investment, not just a savings plan. If you’re unsure about which business to pursue or how to grow your money, start by saving with NSSF. Let your money work for you while you plan your next steps. The Smart Life Flexi Goal-Based Saving Plan is particularly beneficial for those with specific financial goals, offering competitive returns and a structured approach to saving. Consistency is key. Even small contributions can grow significantly over time, thanks to the power of compounding. Take advantage of the tools and resources provided by NSSF, such as the NSS-
FGO app, to set goals and track your progress. Most importantly, start now. The earlier you begin, the more time your money has to grow. Looking back, what are the key lessons you’ve learned about retirement planning through the NSSF Voluntary Savings Plan?
One of the most important lessons I’ve learned is that saving is not optional; it is essential for anyone earning an income. Life is unpredictable, and having a financial cushion can make all the difference. I also learned that no income is too small to save. The NSSF Voluntary Savings Plan encourages everyone to contribute, regardless of their financial situation. The accessibility and flexibility of the plan ensures that no one is left behind. Finally, I’ve come to appreciate the value of patience and long-term planning. Building a retirement fund requires discipline, but the rewards are well worth the effort. With tools like the NSSFGO app, which provides financial projections and motivation, I’ve been able to stay focused on my goals and build a secure future for myself and my family.
Dr Grace Kansiime Mwesigye stares at her banana plantantation in Kampala
How to make savings second nature for many
Stephen Omojong Research & Product Development Manager
Savings are made from the income we earn. Yet, committing to set aside some money for the future can be a difficult commitment. The natural reluctance to save, especially for the long term, stems from the very founda- tion of economic theory – that our needs are insatiable while resources are scarce.
However, the fact that some needs must be met today and others anticipated tomorrow creates the very need to set aside a portion of today’s providence for the purpose of tomorrow’s lack. To strike a balance between prioritising today’s evident needs and focusing on tomorrows
anticipated needs is a challenging process mentally. Psychologists speak of the present need bias innate in every individual driving us all to prefer immediate gratification over future rewards. Our minds associate delayed benefits with increased uncertainty,
which blunts the reward of the potential higher payoff. We see it as risky and presumptive in the present and uncertain.
If the odds of rational thought are stacked against savings, how then do others succeed where many fail? What helps some forego today’s satisfaction in anticipation of a more rewarding tomorrow? Research postulates that the difference comes from capacity-related factors like level of income, willingness-related factors, as well as structural factors like accessibility. In this article we have restricted ourselves to private savings and, even more particularly, the savings by individuals and households. But, it should be known that other sectors of the economy can save as well.
A woman counts her money before placing it in a saving jar.
What then does research and data on NSSF members tell us about their saving behaviour?
The postulation that income levels determine one’s ability to save is validated. First and foremost, due to compulsion, individuals with higher salaries are forced to save more in absolute terms even though the percentage deduction is the same. Secondly, data shows that lower wage earners are more willing to collude with employers to avoid NSSF deductions than higher wage earners. Another indirect indicator that higher wage earners feel less deprived is the fact that up to UGX 1.3 trillion in balances is left unwithdrawn from the Fund by qualifying members, and most are higher wage earners. The third indicator is seen in the phenomenon of interest forfeiture that occurs when a qualifying member draws their benefit after the end of the financial year but before the declaration of interest. In this case, a member stands to lose the difference between the interest to be declared and the statutory rate of 2.5% applied for exiting members in the period July to September. Evidence shows that members with less balance (by deduction, low-wage earners) are less willing to delay claims until after the declaration. While income is not the only determinant of the decisions referenced here, it goes to show that higher earnings generally aid savings through increased saving tickets and more willingness and/or ability to delay gratification.
The ease and accessibility of the saving product available to a customer has been observed to have an effect on customers’ saving behaviour. For example, some customers tend to save only when reminded; in-person reminders tend to have more immediate results than impersonal ones despite their higher cost disadvantage. The argument here is that the act of
saving is already painful in itself; the least customers want is to be subjected to additional bothers like filling in forms, worrying about receipt of their savings, charges, travelling, or following complicated procedures. This convenience factor combined with the embedded social pressure are the main drivers of community-based saving mechanisms like merry-go-rounds, VSLAs, and SACCOS; these have demonstrated that even the poorest among us can save. While some systemic barriers are difficult to mitigate, NSSF voluntary programs now aim at making saving a subconscious decision; this is when we will
UGX 1.3 tn
in balances left unwithdrawn from the NSSF by qualifying members.
satisfy ourselves to have finally made savings a way of life.
The trust that a saver has in the selected saving vehicle also helps reduce the risk perception associated with the saving decision. Some savers who choose NSSF have cited the fact that it is a government entity that has a close to 40-year legacy and is enshrined in the law of the land as one of their choice drivers. However, trust must be earned! Data of the Fund has shown that customers have tended to continue trusting the Fund even when they would have been expected to have concerns. Some customers find comfort in the fact that their mandatory savings have continued to be safe in spite of adverse speculations once in a while, and this has given them comfort that over the long term, the Fund may be one of the best to trust.
This article has addressed income as the capacity determinant of saving, convenience as the structural enabler, and trust as the psychological comforter, yet saving decisions can also depend on other factors, including the age and related shift in needs, education background – especially exposure to financial literacy, peer and cultural influences on savings behaviour, and consumption patterns, among others. The Fund, being one of the many players championing
Some savers who choose NSSF have cited the fact that it is a public entity that has a close to 40-year legacy and is enshrined in the law of the land as one of their choice drivers.”
savings mobilisations, shares the burden of making savings an easy and rewarding endeavour; however, customers still hold sway. In the arena of voluntary savings, the customer must decide how much, when, where, for how long, and what to save for. This is why, despite what is known about the savings culture, there is more to learn. We therefore believe that Smartlife Flexi and the other voluntary saving programs will help us understand our customers even better.
The 2025 Financial Literacy Program: Equipping members for successful retirement
Anna Maria Sanyu Financial Advisor
In 2019, a post-retirement research study conducted by NSSF revealed a harsh reality: 80% of NSSF beneficia- ries exhaust their entire savings within just two years of retirement.
Only 20% manage to use their savings effectively, achieving a moderately comfortable retirement. Furthermore, many retirees lack the skills needed to succeed in business, often resulting in significant business failures and the loss of life savings. Put into perspective, just 5% of retirees in Uganda attain financial independence after retirement.
For many, financial decisions are
made without adequate knowledge, often relying on advice from household members or relatives.
To address the above issues, NSSF in 2019 established the Financial Literacy Programme. The program provides NSSF members with access to professional advice on finance, investment, and business solutions, empowering them to make informed decisions.
Participants receive a certificate upon completing the program, which covers crucial topics such as:
Savings and debt management
Budgeting
Entrepreneurship
Retirement planning
The program is flexible, offering sessions online, in workplace settings,
through peer cohorts, and in institutional arrangements.
Over the years, the Financial Literacy Programme has featured respected thought leaders like Robert Kabushenga and Florence Kintu, who have shared insights on diverse topics, including financial parenting, saving, and investing among others.
To date, over 2 million individuals have benefited from the program, many of whom have shared inspiring success stories. Henry Mbeera, a businessman in Kampala, credits the program for transforming his entrepreneurial journey:
“I joined the financial literacy program to follow my passion for entrepreneurship. They brought in tutors with real-world business experience, equipping me with essential tools for business management, customer satisfaction, and organization, among other skills,” Mbeera shared.
NSSF’s Financial Literacy Program is a continuous initiative by the Fund. Register via https://www.nssfug.org/benefits-products/financial-literacy/ and mark the dates below on your calendar to participate in this year’s program.
A webinar session of the financial literacy program conducted by NSSF Uganda
