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Scaling up the Impact of SMS Reminders on Pension Savings

Financial Inclusion

Credit: ITU Pictures

Government Pension Program in Kenya Integrates SMS Messaging based on CEGA-supported Research

A key policy issue in low and middle-income countries is how to incentivize workers in the informal sector to plan and save for retirement. Funded by CEGA’s East Africa Social Science Translation (EASST) program in 2013, EASST fellow Amos Njuguna and CEGA affiliated faculty William Dow studied the impacts of SMS reminders on increasing the consistency and amount of government pension savings in a micro-pension scheme in Kenya, called the Mbao pension plan. Designed by the Government of Kenya’s Retirement Benefits Authority (RBA), the Mbao plan intended to help workers in the informal sector — who comprise 83.6 % of Kenya’s workforce — plan and save for retirement. The RBA was particularly interested in evaluating the Mbao pension plan because it identified inconsistency in savings as a potential threat to the country’s pension planning.

Results of the study revealed that SMS reminders influenced short-term savings but did not generate long-term effects after 24 months. Findings also showed that the timing of messages were important, as participants were more likely to act on messages in the evening or early morning.

In 2018, Njuguna was funded by CEGA to incorporate these findings into the RBA’s engagement strategy. Njuguna closely collaborated with the RBA from the onset of this study and convened several meetings with government officials and implementers of the MBAO program to present results and recommendations. This study directly led to the  incorporation of targeted SMS messaging into the RBA’s programs.

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Impact of SMS Reminders on Pension Savings


research   |   Financial Inclusion


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