Since some 30 years ago, various attempts have been made by the Social Security Commission (SSC) to come up with a broadly acceptable and viable policy and legal framework for the operationalisation of the NPF. In the meantime, formal sector employers and their employees have started to contribute between 12% to over 20% of employee salaries to pension saving arrangements.
The country's existing occupational and private pension funds governed under the Pension Funds Act 24 of 1956 and regulated by NAMFISA have amassed significant assets under management and continue to serve as key institutional investors in the national economy. These retirement funds, primarily accessible to formal sector employees, support both long-term savings and macroeconomic stability through investment in infrastructure, government bonds, and capital markets.
Most formal sector employees have employer-sponsored retirement funds, but without the NPF, no pension system exists for most low-income, regulated-wage industries, and informal sector workers. They remain excluded from contributory or occupational pensions. A well-designed national pension strategy legally clear, fiscally sustainable, and interoperable can promote both social justice and economic stability. The change should be integrative, not disruptive.
The urgency of reforming Namibia’s pension landscape is heightened by its youth-dominated demographics. According to national statistics, nearly 70% of Namibia’s population is under the age of 35, and many are already engaged in informal economic activities without social protection. As this generation ages, the absence of a safety net will deepen poverty and widen inequality. To move forward, Namibia can learn valuable lessons from countries that have made notable strides in designing pension solutions tailored to the realities of informal workers. These include Kenya’s Mbao Pension Plan, India’s Atal Pension Yojana, and Rwanda’s Ejo Heza long-term savings scheme.
As Namibia charts the path toward a universal pension framework, it must adopt an approach that balances inclusivity with structural continuity. Crucially, any new social pension or contributory national scheme must not displace or dismantle the existing voluntary pension system, which has taken up an integral role in domestic capital formation, financial market development, and contributes meaningfully to GDP.
Reform experiences in countries like Kenya, India, and Rwanda demonstrate that it is possible to expand pension coverage to informal sector workers through parallel mechanisms, without abolishing or undermining formal pension systems.
Kenya's Mbao Pension Plan, launched in 2009 and officially known as the Blue MSMEs Jua Kali Individual Retirement Benefits Scheme, is a voluntary pension scheme designed specifically for informal sector workers. Members contribute a daily minimum amount of KES 20, hence the programme’s slogan, usitupe mbao, “do not throw away 20 shillings”. The plan leverages mobile money platforms such as M-Pesa and Airtel Money to allow members to contribute as little as KES 20 per day, making it both accessible and flexible.
By 2018, the scheme had about 100,000 contributors, despite the Jua Kali Association representing 12 million informal workers. It allows flexible, penalty-free contributions and lump-sum withdrawals after three years, with funds managed by professionals under Retirement Benefits Authority oversight. While it promotes saving and financial literacy, it faces low coverage, limited awareness, administrative issues, and frequent early withdrawals, which undermine its pension role.
In contrast, India’s Atal Pension Yojana (APY), launched in 2015, represents a government-backed effort to provide guaranteed pensions to informal workers. The scheme is targeted at all Indian citizens between the ages of 18 and 40 who are not covered by any statutory social security scheme and are not income taxpayers. Subscribers choose a guaranteed monthly pension amount (ranging from INR 1,000 to INR 5,000) that they will begin receiving at the age of 60. Contributions are made monthly and vary depending on the age of entry and the desired pension amount.
One of the notable features of APY is the government’s co-contribution for eligible low-income workers up to 50% of the contribution or INR 1,000 per year, whichever is lower for a period of five years for early enrollers. The scheme is administered by the Pension Fund Regulatory and Development Authority (PFRDA) and operates through India’s National Pension System (NPS) architecture. Importantly, APY requires 100% annuitisation at retirement, ensuring a steady monthly income for life. In the event of the subscriber’s death, the pension is transferred to the spouse, and eventually, the pension corpus is paid out to the nominee. Although early exit is restricted, exceptions are made in cases of death or terminal illness. The scheme has grown steadily due to its clear design, compulsory savings logic, and government guarantees, which build trust among low-income populations.
Rwanda offers another compelling example through its Ejo Heza Long-Term Saving Scheme, introduced in 2017. Ejo Heza, meaning “better tomorrow,” is a voluntary, defined contribution savings scheme open to all Rwandan citizens and residents, including informal workers, salaried employees, and even children through guardian-linked accounts. Administered by the Rwanda Social Security Board, the scheme is linked to an individual’s national ID and operates primarily through mobile technology making registration and contributions seamless and widely accessible.
Unlike traditional pension schemes, Ejo Heza emphasizes flexibility: contributors decide how much and how often they save daily, weekly, or monthly. It promotes a savings culture, financial inclusion, and social security access, even to those previously excluded from such protections. What makes Ejo Heza particularly innovative is its tiered government co-contribution incentive based on socio-economic vulnerability. For example, individuals in the lowest income categories (Ubudehe 1 and 2) receive a 100% match on savings up to a certain amount, while higher tiers receive proportionately less. Additionally, members who save above a set threshold become eligible for life and funeral insurance benefits funded by the government. These measures encourage long-term saving while offering immediate social protection.
Namibia’s path toward a national pension system must balance inclusion with stability. Lessons from Rwanda, India, and Kenya show that success lies in designing flexible, accessible, and incentive-driven schemes particularly for informal workers. Mobile integration, government co-contributions, and national ID-linked systems are key enablers.
With legal clarity, fiscal prudence, and coordinated governance, Namibia can build a future-facing, inclusive pension system that protects all its citizens regardless of how or where they work while maintaining the strength of its current retirement funding sector.