• Social Security & Housing Finance Corporation
  • 61 Ecowas Ave, Banjul
  • (+220) 422-2271

National Provident Fund (NPF)

Purpose: Compulsory national saving system

General Description: Our National Provident Fund (NPF) ensures members savings are matched by their employers at the rate of 1:2 and paid out to on retirement or should they be made redundant after interest is applied.

Click here for an overview of the SSHFC National Provident Fund

Type of scheme: It is a defined contribution scheme in which both employers and employees alike make fixed contributions into individual member’s account. Benefits paid out are based on the contributions paid into the member’s account plus interest accrued from the time of the first contribution up to a member attaining the normal retirement age of 60 years.

Who is eligible to be covered? Full time employees of any nationality working with a registerable organisation who are aged between 18 to 59 years can register with the NPF. In addition, any employer and employee to whom, the state Pension Board Act applied before the coming into force of SSHFC Act 2015 are eligible. Also, employees of Diplomatic Missions or International Institutions based in the Gambia who are Gambian citizens can participate in this scheme.

Who are registerable organisations for the NPF? Registerable organisations under the NPF are private sector organisations who are registered under the 1973 Business registration ACT.

Who is Disqualified? The following categories of persons are disqualified from participating in this scheme:

  1. Civil and public servants because the government and public enterprises run a separate pension scheme for its staff.
  2. workers below the age of 18 years and above 59 years
  3. Casual Employees that work on a piece-meal basis whether on daily basis or are employed on a fixed term contract not exceeding one-month duration.

Who pays the contribution and how much? Under the NPF, the contribution rate is 15% of the employees’ Basic Salary (i.e. salary without other fixed allowances), because employers matches the contributions paid by employees at a ratio of 2:1. Each month the employees’ contribution of 5% is deducted from their wages and the remaining 10% is paid by the employer on behalf of the employee.

What benefits are paid out and how? For most members their concern is when and how to access their contributions. It is important to note that the savings in the National Provident Fund are for retirement purposes above other considerations. However apart from the normal retirement, there are contingencies that allow members to get paid a part of their savings in the event of a premature termination of service due to ill health, redundancy or on the grounds of marriage for female members of the scheme or a member chooses early retirement.

Who is responsible for the Administration of the NPF? SSHFC is the sole administrator of the Federated Pension Scheme.

Regulatory Framework:

Earlier Acts of Parliament – SSHFC ACT 1981, SSHFC ACT 2010

Current Act of Parliament – SSHFC ACT 2015

Overview of NPF

Qualifying conditions

To qualify for the National Provident Fund members must be:

  • full time employees of any nationality eligible or registerable organisations.
  • aged between 18 to 59 years.
  • employees of Diplomatic Missions or International Institutions based in the Gambia who are Gambian citizens.
  • an employer and employee to whom, the state Pension Board Act applied before the coming into force of SSHFC Act 2015.

A visit will be conducted by a SSHFC Compliance Inspector to eligible or registrable organisations to explain the benefits and workings of the FPS.

Registration form

The employees of member institutions are required to complete the SSHFC registration form, NPF2 FORM (Click here for the form). The completed form must be endorsed by the employer.

Your full name, date of birth, date of employment, job title, current gross and annual salary, marital status, gender and previous employers MUST be stated clearly in the registration form. In addition, the following key documentation must also be submitted with the completed form:

  • A passport size photograph;
  • A copy of a valid proof of identification (a Birth Certificate, National Identification Card or an Alkalo’s Attestation)

Deadline

Member institutions as employer shall remit to the social security fund, all contributions due for all their employees registered in this scheme, not later that the 15th day of the month following that in which the relevant salary or wages were paid.

Calculations

The monthly contributions are calculated at 15% of the employees’ basic salary (i.e. excluding fixed allowances). Each month the employees’ contribution of 5% is deducted from their wages and the remaining 10% is paid by the employer on behalf of the employee.

Remittance schedule

The remittance schedule (NPF3 FORM) must accompany all contribution payments and employers must quote this when they pay contributions for their employees. The remittance schedule must be accurately completed giving names, salary, Social Security numbers and the amount payable for each employee.

Members accounts will be updated as contributions are paid in by employers using the information on the NPF3 FORM.

Late payment

A penalty charge of 2.5 % (per cent) of the unpaid amount will be levied on the employer for the late payment of contributions for each month or part of the month such amounts remain unpaid.

The following events trigger the pay out of pension benefits:

  1. Normal retirement - this is when a member of the scheme reaches the official retirement age of 60 years in their work place.
  2. Voluntary retirement – this is when a member of the scheme chooses to retire at 45 years of age, before the official retirement age.
  3. Retirement on the Grounds of Ill-Health - this is when a member is forced to retire prematurely on the grounds of ill-health or disability. Such retirement must be advised by a medical authority that by reason of permanent physical disability, he/she is unable to continue to engage in any gainful employment.
  4. Retirement on the grounds of marriage - Female members of the scheme who are married should they wish to retire on marriage grounds can do so if they provide evidence of marriage by submitting a marriage certificate.
  5. Redundancy – this is where a member institution is liquidated and so lays off their staff.
  6. Death - this is where a member of the scheme dies a Survivors Benefit will be paid out to their nominees. The claim must be accompanied by:
    • A letter of claim by the nominee(s).
    • Evidence of the death of the member – a death certificate or a document from the Chief of the area where the deceased was buried.
    • Photographs and birth certificates of all who have a legitimate claim to the estate of the deceased.

N.B. To be eligible in any of the above events except in the case of death a person must:

  • have been a member of the scheme at least 5 years. A member with less than 5 years membership of the scheme, who chooses to retire before the statutory retirement age would forfeit his/her benefits.
  • be jobless at the time of the claim

A cooling off period must be observed and the length is determined by the age of the member at the time of retiring. For those withdrawing from the scheme between the ages of 45 - 54 years, a 6-months cooling off period must be observed. For those aged 55 years and above, a 3-months cooling off period is required. The cooling off period begins from the date of submission of claim. The resumption of employment before the expiry of the cooling off period shall terminate entitlement to benefit.

Applying through their employers retirement benefit benefit payment will made to scheme members as follows:

  1. Normal retirement benefit - Claimant will receive a lump sum made up of:
    • The 10% contribution of the employer
    • The 5% contribution made from your salary
    • Plus a very generous interest rate based on the average rate of returns on investment.

    At the request of the claimant however, part of the lump sum may be converted into an annuity, receivable periodically similar to a monthly pension.

  2. Withdrawal benefit will be payable when a person chooses voluntary retirement and depending on their age as follows:

    AGE PERCENTAGE OF ACCURUALS PAYABLE

    • 45 – 54 years 70%
    • 55 – 59 years 85%

    The balance in the member’s account shall be payable on normal retirement or when entitlement is established under the other contingencies, subject to qualifying conditions relating to those contingencies.

    This benefit is not payable to a member who leaves one employer for another. Members who prematurely retire can re-join the scheme if they are not more than 59 years of age.

  3. Invalidity Benefit - Benefits paid are proportional to the degree of disability as follows:
    • Where a member’s disability is total and permanent, the benefit payable shall be the full balance in his account.
    • Where a member’s disability is partial and temporary, the initial benefit payable shall be a proportion of his or her current balance in his account. A claim for further settlement may be considered.
    • In the case of a mentally disabled, the benefit payable shall be in installment to the person in whose care the member is or to the Public Trustee.
  4. Optional Withdrawal Benefit (on the grounds of marriage) - withdrawal benefits will be paid out depending on their age as detailed below.

    AGE PERCENTAGE OF ACCURUALS PAYABLE

    • 25 – 31 years 25%
    • 32 – 38 years 32%
    • 39 – 44 years 37%
    • 45 – 54 years 50%
    • 55 – 59 years 60%
  5. Optional Withdrawal Benefit (on the grounds of redundancy) - withdrawal benefits will be paid out to the member who has been made redundant based on their age and calculated in the same way as for women who retire on the grounds of marriage (See above).
  6. Survivor’s Benefit - The survivors will be entitled to a tax-free lump sum equivalent to all savings and interest due over the entire period of employment.

Accounts are closed following full settlement of benefit. However they will be maintained as dormant for reference purposes until expiry of member record retention period expires as per policy.