NSSF Uganda: 2025/2026 Interest Rate Set at Record 22.53 Percent

• The National Social Security Fund (NSSF) will pay a 22.53 percent interest rate to members for the 2025/2026 financial year, the highest payout in its history.
• This record NSSF Uganda 2025/2026 interest rate follows an 86 percent surge in annual revenues to 6.51 trillion shillings and an increase in assets under management to 32 trillion shillings.
• Minister Henry Tumukunde challenged the NSSF to ensure its $9 billion fund actively contributes to national development and urged a shift to a private sector management approach.
• The Minister also vowed to deregister employers defaulting on Uganda National Social Security Fund contributions, leading to potential revocation of their trading licenses.
• NSSF aims to expand its active membership to 15 million by 2030 and grow total assets to 80 trillion shillings by 2035.

A minister explicitly vowed to deregister defaulting employers from NSSF contributions, instructing his subordinates to identify such entities for recommendation to the Ministry of Trade, Industry and Cooperatives for the revocation of their trading licenses.

The National Social Security Fund (NSSF) has declared a significant 22.53 percent interest rate for its member-savers for the 2025/2026 financial year. This announcement was made by Henry Musasizi, the Minister of Finance, Planning and Economic Development, during the 14th Annual Members' Meeting, attributing the high payout to the fund's robust performance.

This substantial NSSF Uganda 2025/2026 interest rate translates into an unprecedented 5.44 trillion shillings in interest payments, marking the largest volume and highest interest rate ever distributed in the fund's history. For context, the NSSF had declared an interest rate of 13.5 percent for the preceding 2024/2025 year, which amounted to approximately 2.5 trillion shillings in value.

The record interest rate is a direct reflection of the Uganda National Social Security Fund's exceptional financial health. The institution reported an impressive 86 percent surge in annual revenues, reaching a new high of 6.51 trillion shillings. Concurrently, assets under management experienced substantial growth, climbing from 26 trillion shillings to 32 trillion.

Member contributions also saw a healthy increase, rising by 13 percent to 3.4 trillion shillings, while 1.5 trillion shillings were disbursed to eligible savers. According to Managing Director Patrick Ayota, this strong performance was driven by several factors, including the overall growth of the economy, the favorable performance of stock markets in East Africa where the NSSF holds significant investments, and the appreciation of currencies against the Ugandan shilling.

In a stern address, Henry Tumukunde, the Minister for Gender, Labour and Social Development, challenged the NSSF Board and Management to ensure the fund's considerable value, estimated at around $9 billion, actively contributes to the national development agenda. He questioned whether the investments were yielding optimal returns, asserting that the fund's capital must actively "turn around the economy" and "change the economy." Minister Tumukunde also advocated for a shift from a "Parastatal style" of management to a more dynamic private sector mindset, emphasizing the importance of hiring based on competence rather than solely academic qualifications.

Crucially, the Minister vowed to take decisive action against employers defaulting on their NSSF contributions. He explicitly stated his intention to have such entities deregistered by the Ministry of Trade, Industry and Cooperatives, instructing those under his control to identify defaulters for recommendation to the Ministry of Trade, Industry and Cooperatives for the revocation of their trading licenses. Meanwhile, Finance Minister Musasizi commended the NSSF for its investments in government programs and affirmed his ministry's ongoing support to help the fund balance its investment strategies with the imperative of creating value for its savers.

Looking ahead, the NSSF has outlined ambitious targets within its 10-year strategic plan. The fund aims to significantly expand its active membership, targeting 15 million savers by 2030. Furthermore, it plans to scale its total assets to 50 trillion shillings and eventually reach 80 trillion shillings by 2035.

Managing Director Ayota highlighted several government infrastructure projects, such as the highly anticipated Kampala-Jinja Expressway, as potential financing opportunities for the fund. However, David Ogong, the chairman of the Board of Directors, noted that despite the NSSF possessing substantial investable resources, its investment endeavors are ultimately constrained by existing legal frameworks.

Compliance officers and legal counsel in Uganda should be aware of the Minister's explicit directive to deregister defaulting employers from NSSF contributions. This necessitates an urgent review of client compliance with NSSF obligations to mitigate the risk of trading license revocation.

Source: Original reporting via Independent (Kampala)