Emmaculate Kabuya
HARARE (FinX) – Zimbabwe’s pension funds are in a precarious position, navigating a landscape of systemic challenges that threaten their long-term viability.
However, a growing consensus among industry leaders suggests that this period of uncertainty could serve as a catalyst for a bold technological transformation. By leveraging innovation and digital integration, the sector aims to restore the eroded trust of millions of Zimbabweans while building a more resilient financial future.
The urgency for this shift stems from deep-seated structural issues, primarily characterized by operational inefficiencies, prohibitive costs, and a historical lack of transparency. These factors have combined to undermine public confidence in traditional pension models
Speaking at the Zimbabwe Association of Pension Funds breakfast meeting, Dr Matthews Kunaka, a senior partner at REANDA Chartered Accountants, emphasized the need for pension funds to adapt to the changing landscape.
The industry must innovate to survive, he said, pointing to the potential of digital platforms to enhance transparency and efficiency.
“For instance, integrating mobile payment systems could allow pensioners to access their funds more easily, particularly in rural areas where banking infrastructure is limited. Mobile technology can bridge the gap and ensure pensioners receive their benefits without unnecessary hassle.”
Dr Kunaka also highlighted the importance of optimizing costs, noting that Zimbabwe’s pension funds have room to reduce their branding and administration costs, which are currently 15-25% higher than global benchmarks.
“There is scope to streamline operations and pass on the savings to members.”
The need for innovation is clear, but it must be balanced with effective regulation and a focus on member value.
Dr Douglas Mamvura, chairman of Alpha Asset Management, stressed the importance of building a strong foundation for the future.
“You can’t build where there is no foundation,” he said, emphasizing the need for Zimbabwe’s academic institutions to equip graduates with the skills needed to drive innovation.
Additionally, pension funds could explore partnerships with fintech companies to offer value-added services such as financial planning and investment advice, enhancing member engagement and loyalty.
By diversifying their offerings, pension funds can increase their relevance and attract new members.
Zimbabwe’s pension funds stand at the threshold of a new era, one where innovation and resilience pave the way for prosperity.
Dr Mamvura concluded by saying, “whatever you imagine, adequately desire, sincerely believe and enthusiastically act upon it will inevitably come to pass”.
