Malawi Union of Savings and Credit Cooperatives (Muscco), an umbrella body for the savings and credit cooperatives (Saccos), has urged Sacco members to consider making alternative savings plans for retirement.
Muscco business development manager Ezekiel Thindwa said in an interview on Friday on the sidelines of a two-day training workshop on pension planning management, which seeks to create a complementary savings package for pensioners, who are Sacco members.
He said the new product will offer competitive interest rates, attract tax free interest on savings to ensure that members benefit more by saving under the retirement savings package.
“The initiative is intended to encourage savers in Saccos to build capital, provide security to members’ funds and allow members to make meaningful savings they could use when they retire,” he said.
Thindwa encouraged Sacco members to embrace the new product, expected to roll out this year, saying the product comes with numerous benefits.
On his part, one of the facilitators of the training, Alfred Mlenga, managing consultant at Precision Training Partners, said Saccos can play a role in ensuring that people who are about to retire make alternative savings plan as one way of preparing for a better life after work.
“The idea is to see if Saccos can come in to assist in saving for retirement. The critical issue is that it is said the 80 percent of people that retire regardless of what positions they were holding from wherever they were working, retire broke. They live a miserable life and cannot make ends meet,” he said.
A representative for the trainees, Innocent Kapachika, described the training as vital, saying pension planning through saving with cooperatives such as Saccos would provide an efficient source of extra income.
“What has come out clear over the years is that the savings we get from pensions are not sufficient to cover our retirement expectations. The new product thus complements people’s savings ultimately ensuring that people live a decent life after retirement,” he said.