Nico Life Insurance Company, a subsidiary of Nico Group, has expressed worry over delays in remitting pension contributions to pension administrators by some institutions.
The company says this violates and denies the employees’ right and chance to earn interest on their income.
Nico Life Insurance Company Chief Executive Officer, Eric Chapola, was speaking Wednesday on the sidelines of the company’s 2019 annual trustee seminar in Lilongwe.
“The major issues that we seem to face in the pension sector, year-in, year-out, are a company not paying the contributions they deduct from their employees. Secondly, they could deduct, but pay those contributions late. The law demands that when they collect these contributions from their [members of] staff, they must pay them over to us within 14 days,” Chapola said.
Chapola said late remittance of the pension contributions negatively affects the pensioners’ economic livelihood.
“The impact is that the pension funds will not be earning an interest. Secondly, when somebody makes a claim, the pension administrators will not be able to pay,” he said.
Objective of the meeting was to brainstorm and find solutions to challenges in the sector.
In his presentation, the
(RBM) representative, Pacharo Luhanga, warned companies that do not comply with the pension law that the central bank will soon pounce on them.
Luhanga said there are stiffer penalties awaiting employers who will choose to defy the law.