Kenyans have saved over Sh220 billion in the National Social Security Fund (NSSF) since the full implementation of higher monthly contributions in February 2023, new data shows.
The increase in savings is attributed to the full enforcement of the 2013 NSSF Act, which introduced a graduated contribution scheme. Under the revised model, both employers and employees contribute more towards retirement savings, significantly boosting the fund’s collections.
This surge has propelled NSSF’s total asset base to nearly Sh600 billion, marking a major milestone in the fund’s financial growth and its ability to secure retirees’ futures.
History of NSSF
NSSF was established in 1965 by an Act of Parliament (CAP 258 of the Laws of Kenya) in order to administer a provident fund scheme for all workers in Kenya. Originally functioning as a government department within the Ministry of Labour, the Fund underwent significant changes as its membership expanded and its operations grew more complex.
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In 1987, the NSSF Act was revised to establish the Fund as an independent State Corporation. Since 1988, it has been governed by a Board of Trustees comprising representatives from three main stakeholder groups: the government, workers, and employers. Over the years, NSSF Act has undergone several amendments.
Implementation of 2013 Act
The 2013 NSSF Act, although passed over a decade ago, had faced numerous legal and operational hurdles, delaying its rollout.
However, once fully implemented last year, monthly contributions rose from a flat rate of Sh400 to a percentage based system tied to employees’ earnings.
NSSF Managing Trustee, David Koross, welcomed the development, stating it reflects growing compliance and a shift in public perception about the importance of retirement savings.
“We are seeing better financial discipline and increasing awareness about future planning. These contributions will go a long way in improving social security for Kenyans,” he said.
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According to NSSF, the enhanced contributions are also expected to strengthen the fund’s investment capacity in key sectors, including infrastructure, housing, and government securities, further supporting national development goals.
