Local Authorities Pension Trust

Rukisha: Enhancing penetration and compliance of remittances by leveraging on the electronic payment ecosystem

Implementation year

A brainchild developed after years of engagement with informal sector participants, Rukisha which in English translates to “Leap”, is a proprietary solution that is poised to revolutionize the social security sector driving penetration and more significantly enhancing compliance in the payment of contributions.

Pension coverage in Kenya is approximately 20 per cent of the formal working population while the informal sector is largely uncovered. A study of the International Labour Organization (ILO) estimates that the informal economy in Kenya represents about 85 per cent of non-agriculture employment and over 90 per cent of micro and small enterprises. However, despite its significant contribution to the gross domestic product (GDP) of over 60 per cent by some estimates, social security penetration and solutions are relatively low.

Various initiatives by the government to increase this coverage have yielded very low results with the most recent being a micro pension solution for the informal sector, which was initially taken up, proved expensive to run due to high administration costs and constant withdrawals of funds by members. The Rukisha solution closes the gap and simultaneously addresses penetration as well as remittance by leveraging on the digital payment ecosystem enabling real-time access to over 1 billion US dollars (USD) in mobile money transactions.

The Introduction of Rukisha in the market seeks to enable the working population of Kenya save up to 5 per cent of the USD 1billion (USD 50 million) annually and therefore impacting the GDP

Governance and administration
Information and communication technology
Contribution collection and compliance