Ejo Heza: Can new savings scheme secure the future of informal workers?

Tomato farmers work in a plantation in Muko Sector in Musanze District. RSSB has encouraged Rwandans to embrace the Ejo Heza scheme. / Sam Ngendahimana

Abdul Khalim Niyokwizerwa, 25, a motorcycle taxi operator from Muhanga District, does not have a fixed monthly income because of the nature of his job, but can afford to save at least Rwf10,000 per month after catering for all his living expenses.

Niyokwizerwa is among millions of informal sector workers who are excluded from Rwanda’s mainstream pension scheme because their wages are not fixed.


This situation means that once he is unable to work due to old age, injury or disease that leaves him with a permanent disability, he will have nothing to fall back to for a living.


To put this into context, only 8 per cent of 5.4 million active Rwandans in the working age bracket have access to long-term saving through pension schemes.


The remaining 92 percent, mainly motorcycle taxi operators, drivers, masons, farmers and people involved in handcrafts, are excluded from pension schemes.

This has prompted Rwanda Social Security Board (RSSB) to introduce a new long term voluntary savings scheme known as EjoHeza—which caters for both salaried and unsalaried people.

Based on pension calculations by RSSB, if at 25 years of age, Niyokwizerwa started contributing Rwf 10,000 per month through EjoHeza, at 55 years he would be able to earn a monthly income of Rwf198, 000 in pension benefits.

Indeed, the youthful motorcycle taxi operator, who has already signed up for the scheme, is upbeat about the potential benefits of securing his retirement. 

“I thought that pension scheme is a preserve for public employees with fixed salary. Pension is important as it can ensure my better life when I get old and I am unable to do the work that was enabling me to earn my daily bread,” he told The New Times.

RSSB says that workers have the option to save as low as Rwf2,000 every month.

Jacques Rutsinga, Business and Operations Team Leader at EjoHeza, said that the establishment of the initiative in December 2018 was informed by a 2012 research by National Institute of Statistics of Rwanda, which indicated that the number of old Rwandans – aged from 60 and above – is expected to increase by 60 per cent by 2032.

“As a country that is responsible for the welfare of its people, having realised that the number of old people will increase, the situation required a strategy to take care of those people because they are many, and are (physically) too weak to be able to work for their basic needs in life,” he said.

Currently, he said, over 54,000 of people have subscribed to the scheme, and the number is expected to sharply rise as Rwandans now understand the benefits of saving.

He said a subscriber chooses to pay contributions based on their convenience, citing rice farmers who can make savings after each six months as they get yields twice a year.

“Rwandans [in the informal sector] like the initiative; they see great opportunities in it, which will help them have dignified old age,” he observed.

He added; “This scheme took into consideration the people we can call low-income earners. First, it is flexible in a way that you can save the little money you get, gradually.”

He disclosed that the age for one to access their savings under the initiative is 55 years of old.

This is contrary to the existing pension scheme where a retiree gets their benefits when they are turn 60 to 65. 

Investments and returns

The savings under EjoHeza will be invested in investment generally considered to be free from risk of monetary loss such as government treasury bills and bonds, as well as bank deposits, and the profits will be given to the subscriber based on the amount of savings they have in the Fund, Rutsinga explained.

On average, returns on such investments are estimated at 10 per cent.

For one to receive pension, they should have saved Rwf4 million and above. In case the savings are less than that, the subscriber gets a lump sum – single amount consisting of the money they saved plus the interest accrued over time.

Benefits before retirement age

The law setting up the scheme, Rutsinga said, provides that if your savings have surpassed Rwf4 million, you can get 40 per cent of it and use it for various purposes such as housing, paying school fees for yourself or your children or use it as collateral to get loans from financial institutions, provided that your remaining reserve in the programme is not less than Rwf4 million.

Mobilising the public

RSSB has started encouraging Rwandans to embrace the scheme through engaging cooperatives, as one of target groups.

There are over 8,400 cooperatives with over 4.9 million members countrywide.

“The people gathered in cooperatives have no regular income, but get it in a given period. Those are being trained how to use this scheme,” he said.

He added that they are considering ways to sensitising public and private institutions to know that there is a complementary pension scheme, adding that it has been realised that some have insufficient pension currently.

People can register to the scheme using mobile phone by dialing *506#, the same code they can use to pay their contributions by means of mobile money; and

National Identity card works as bank account [for those who do not have one]. They might also use the website ejoheza.gov.rw.


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