Shock retirement numbers for South Africa
Representatives of the retirement and savings industry presented their submissions to parliament on Wednesday (19 May) on the Democratic Alliance’s proposed Pensions Funds Amendment Bill.
The bill aims to amend the current Pension Funds Act to allow pension fund members to obtain a loan, secured by a guarantee from a registered pension fund, to alleviate financial pressure during an emergency.
In this case, the bill makes direct reference to the Covid-19 emergency or any other emergency similar to Covid-19.
By enabling a member to access a pension-backed loan, that member will be able to leverage their pension fund investment prior to their retirement date, without eroding their provision for eventual retirement.
Lending institutions will be enabled to offer loans to pension fund members at competitive interest rates and over extended or deferred payment periods given that the loan is fully guaranteed, the DA said.
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