According to the Retirement Benefits Authority (RBA), mortgage loan regulations are under a review to enable pension members to use part of the savings to purchases houses.
The benefits will be accessible once the guidelines are gazetted.
“The amendment to the RBA (mortgage loan) regulations is underway and will advise stakeholders once Treasury CS Yatani gazettes the amendment,” a statement from the RBA boss.
The President recently accepted section 38 of the Retirement Benefits Act (1997). The act allows pension savers to access and use a portion of the retirement benefit to purchase houses.
RBA is expected to state the allowable limit and the set conditions for accessing the savings. On the other end, the Housing and Urban Development ministry is proposing access of up to 60 percent of the savings.
However, pension stakeholders say there is a need to restraint workers from accessing savings prior to retirement.
Simon Nyakundi, chairman to the Association of Retirement Benefits Schemes, also believes it is not a good idea to allow pensioners to access their savings that early.
“No saver should be allowed to wipe out all their savings since upon retirement at 60 years. One needs an income replacement ratio, equivalent to about 70 percent of their last income available for personal use in the next 20 or more years. Pension is meant for old-age dignity and comfort,” he said.