Oliver Kazunga, Senior Business Reporter
CBZ Bank has launched a pension fund for Small to Medium Enterprises (SMEs).
In an interview on the sidelines of the inaugural CBZ International SMEs indaba in Bulawayo yesterday, CBZ Bank chief executive officer Mr Never Nyemudzo urged players in the SMEs sector to embrace the pension fund meant to cushion workers in the sector when they retire.
“At some point we know you will retire because you will not be able to run the business the way you run it today, therefore, you need to contribute to a pension fund.
“If that eventuality happens, then you receive your monthly payment to take care of your day-to-day life,” said Mr Nyemudzo.
“This is a very innovative product that we have put together as CBZ Life and we invite all the SMEs to look into it and together we can build a very big pension fund for SMEs.”
Mr Nyemudzo said the drive to set up the SMEs pension fund was premised on the realisation that the sector has of late become the country’s biggest employer.
He said CBZ was working with the Insurance Pension Fund (IPEC), which is Zimbabwe’s insurance industry regulatory authority to improve the SMEs fund.
The CBZ boss said they have invested about $10 million into the pension fund and this was above the regulator’s minimum threshold of $5 million. “We have invested quite a lot, not directly into the pension fund because the pension fund is a resource for those who are contributing. But where we have invested is to say the underwriter, which is CBZ Life has got adequate capital,” said Mr Nyemudzo.
He said IPEC expects life companies to have capital of about $5 million to run a pension fund and CBZ Life already has got over $10 million.
“So the company, which is underwriting this product has got enough capital to withstand any shocks coming from either the pension fund being eroded by economic conditions. In terms of the pension fund, for you to join you must have at least five employees. With that requirement all the employees can join and start making monthly contributions,” he said.
The Ministry of SMEs and Co-operative Development targets to have registered about 15 000 players for taxation with the Zimbabwe Revenue Authority by the end of the first quarter this year.