A New Savings Avenue for the Informal Economy

Financial services provider Liberty Kenya has launched the 'Boresha Maisha' pension scheme, a new initiative primarily targeting self-employed individuals and workers in the nation's vast informal sector. Announced on Tuesday, 4 November 2025, in Nairobi, the plan is designed to offer a flexible and accessible retirement savings solution for a segment of the population historically excluded from formal pension systems. The product is structured with two main offerings: an individual plan for personal savings and an umbrella fund for employers to manage their staff's retirement benefits.

Key features of the 'Boresha Maisha'—Swahili for 'Improve Life'—plan include the ability for members to contribute at their own pace, professional fund management, and tax advantages on contributions. Additionally, the plan incorporates a last expense coverage of KES 100,000 to assist families during difficult times.

Addressing Kenya's Pressing Pension Coverage Gap

The launch comes at a critical time for Kenya's retirement benefits sector. According to the Retirement Benefits Authority (RBA), pension coverage remains critically low. As of 2024, only 26% of Kenya's working population was covered by a pension scheme, a figure that has seen minimal growth over the past two decades. This leaves a significant majority, particularly the over 16 million Kenyans in the informal 'jua kali' sector, facing old age without a financial safety net.

A 2024 Pensioner Survey conducted by the RBA painted a stark picture of the challenges retirees face, with many citing inadequate pension benefits, the high cost of living, and the burden of supporting dependents as major struggles. The survey revealed that only 41% of retirees felt their pension benefits were sufficient to live on, and a staggering 83% reported supporting dependents, often their adult children and grandchildren.

This low coverage and inadequacy of savings places a significant strain on the economy and reinforces a culture of old-age dependency on the younger, working population.

Government Reforms and a Broader Industry Push

Recognizing the urgency, the Kenyan government and the RBA have embarked on a series of reforms to foster a stronger savings culture. On 29 August 2024, the RBA launched its Strategic Plan for 2024-2029, which ambitiously aims to increase pension coverage from 26% to 34% of the workforce by 2029. A central pillar of this strategy is the development and promotion of products specifically tailored for informal sector workers.

This aligns with a broader government push to expand social protection. The National Treasury has also signalled its intent to overhaul pension management through digitization to improve efficiency and ensure timely payments, which have historically been plagued by delays. The 'Boresha Maisha' scheme is one of the first major private sector products to align with this new national strategy, complementing other initiatives like the Mbao Pension Plan and Haba Haba scheme, which also target the informal economy.

How 'Boresha Maisha' Works

The 'Boresha Maisha' plan is designed for maximum flexibility to accommodate the irregular income streams common in the informal sector. Individuals can decide when they want to retire and are not restricted by employment status, allowing them to make contributions that fit their financial flow. Contributions can be made easily via mobile money platforms like M-Pesa.

The scheme offers several key benefits:

• Flexibility: Members can contribute on their own terms and change employers without affecting their plan membership.
• Professional Management: Funds are managed by Liberty Kenya's financial experts to maximize returns.
• Early Access: Members can begin to access their funds upon reaching the age of 50.
• Security: The funds are legally protected from creditors, ensuring they are available for retirement.
• Legacy Building: In the event of a member's passing, the accumulated funds are paid to nominated beneficiaries.

Challenges and the Path Forward

Despite the innovative design, initiatives like 'Boresha Maisha' face significant hurdles. A primary challenge is the prevailing attitude towards saving; many Kenyans have traditionally invested in their children's education with the expectation of being supported in their old age, rather than saving in a formal pension. Furthermore, low and inconsistent incomes in the informal sector make long-term savings a difficult priority for many who are focused on immediate needs.

Financial literacy and public trust are also critical. The RBA and providers like Liberty Kenya emphasize the need for continuous public awareness campaigns to shift the national mindset from compliance to empowerment. For 'Boresha Maisha' to succeed, it must not only be accessible but also build a reputation for transparency and reliable returns. The success of such schemes is pivotal for Kenya's long-term economic stability, aiming to increase the national savings rate, reduce old-age poverty, and ensure more Kenyans can retire with dignity.