The National Social Security Fund (NSSF) has Thursday declared that it will pay its members 11.23% interest rate on their savings for the year 2016/2017.
This is slightly less than the 12.3% that was paid to members in 2016/2017 financial year.
This slight decline was mainly due to a reduction in the commercial interest rates on fixed income assets where NSSF has its biggest investment that were affected by the central bank’s 10.1% central borrowing rate that was declared at the beginning of this year.
However, although the economy experienced some hardships especially due to the poor agricultural seasons, NSSF managed to grow its earnings by 35% from shs785.5 billion in 2016 to Shs.912 BILLION IN 2017.
Making the declaration at the NSSF annual members’ meeting that took place at Serena hotel in Kampala, the state minister for investment, Evelyn Anite, commended the management of the Fund for striving against the hard economic conditions and earning a substantially good interest for the employees’ money.
“Although there has been a reduction in the interest paid, there is still a 2.6% above the 10 year average inflation rate of 8.67% which is still in the fund’s target to be members an interest rate that is 2% above the inflation rate,” Anite said.
“We understand that since the last financial year, Uganda’s economy has not been doing so well so the fund’s performance is above Uganda’s economy expectation.”
Presenting a report on the Fund’s annual performance, Richard Byarugaba, the executive director NSSF, said that the fund was committed to continue finding better investment opportunities for the members without putting their money at risk
“We have once again outperformed the economy, meeting and in most instances surpassing our targets. This performance is above industry performance meaning that we are delivering value to the members making the fund a distinguished saving vehicle,” he said.
Byarugaba added: “this year there has been a 12% increment in money allocated to paying ineterst for our members from Shs606 billion to Shs681m. With an income of Shs912billion on Shs7.924 trillion, NSSF’s return on assets 11.51% is above the average industrial rate of 8%.”
Over the past five years, the fund has experienced tremendous growth and we continue to promise a good return on the employees’ savings so that their future can be guaranteed.
According to URBRA retirement benefits sector report, the sector posted 8% return on assets in 2016 compared to 14% in 2015.
‘The fact that more employees trust us with their money shows that we have earned their trust. It is therefore our obligation to continue improving our processes through automation and provide our members with great investment opportunities and a great customer care service,” Byarugaba said.
NSSF’s investment portfolio is in three major asset classes of fixed income equity and real estates.