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The Eswatini National Provident Fund (ENPF) has announced plans to convert its provident fund into a pension fund.
The conversion is set to benefit members by providing them with a more secure and consistent retirement income.
According to ENPF officials, the current lump sum payout system under the provident fund system poses a significant risk to retirees, as it does not guarantee a predictable income source.
The pension fund system, on the other hand, will provide members with a regular monthly income stream throughout retirement, offering greater protection against inflation and market fluctuations.
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Key benefits of the conversion for ENPF members include guaranteed monthly income, improved financial security, wider coverage, potential for higher returns, and greater flexibility.
The pension fund system will also enable the extension of coverage to previously excluded groups, such as informal sector workers, providing them with access to retirement savings.
“We understand that the transition process can be complex, but we are committed to ensuring a smooth transition for our existing members,” said an ENPF spokesperson.
“Our goal is to provide them with a more secure and predictable retirement income, while also promoting financial stability and security for the broader Eswatini population.”
The conversion is also expected to support financial stability in Eswatini by promoting sustainable investments, increasing savings, enhancing capital markets, and ensuring economic resilience through structured investments.
While the conversion may not necessarily change contribution rates, it is essential that members understand how their contributions will be utilized under the new pension scheme. ENPF officials have emphasized the importance of clear communication and transparency throughout the transition process.
The conversion of ENPF into a pension fund marks a significant milestone in Eswatini’s journey towards financial stability and security. As the country continues to navigate the complexities of financial inclusion, the ENPF’s move is a beacon of hope for a more secure and predictable retirement income for its citizens.
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It should be noted that the transition process unfolds, stakeholders are encouraged to engage with ENPF officials to ensure a smooth transition and to benefit from the new pension fund system.
With the potential for higher returns, greater flexibility, and improved financial security, the ENPF conversion is set to revolutionize the retirement landscape in Eswatini.
