Local Authorities Pension Trust

Administrative solutions on pension payments: Saving costs through a mobile wallet for pensioners

Implementation year

Service quality measured by effectiveness and efficiency of systems by social security institutions is paramount in driving trust and confidence in socials security systems. Currently, mobile banking penetration in Kenya is approximately 90 per cent of the population and pension schemes make payments to individual pensioner through traditional channels such as banks and credit unions. These channels have a cost implication to the scheme and to the pensioner.

Taking cognizance of this, the trustees of the Local Authorities Pension Trust (LAPT) introduced a mobile wallet for its pensioners where pension is remitted directly into their individual pension accounts. The pilot started with 200 pensioners (2 per cent of 7,000 pensioners) earning minimal pension and has resulted into savings for the schemes as the processing costs are low for the scheme and the pensioner. In addition to this, the pensioner has the addional benefit of pension advance at no cost whenever they are cash strapped. This innovative solution can be replicated in any social security scheme paying pensions.

Old-age pensions
Information and communication technology
Service quality