Micro Pensions for Women; Initiatives and Challenges in India

• DOI: 10.1007/s12126-014-9207-x
• Publication Date: 2014-11-03T02:26:12Z
• Authors: Caroline E. van D...; Jeanne G. M. de B...
• Keywords: Pillar; National Pension; Value (mathematics)

Abstract In rapidly ageing countries, increased life expectancies threaten the poorand low-income workers. India is such a country. The number of people over sixtywill rise from the present 90 million to an expected 200 million by 2030. Givingthe changing demography, family structure and settlements the need for pensionproducts is increasing. This counts particular for women since they live longer andhave less opportunities to create a pension by lack of formal labour force participation.This paper focuses on recent initiatives taken in India to analyze theimprovement of the pension coverage and its capacity to prevent women’s old agepoverty. How can the low pension coverage in India - in particular for lowincomefemale workers in the informal economy -, be increased? The researchfocuses on new pension schemes introduced by the Indian Government and newmicropension provisions by grass root non-governmental organizations (NGOs)and microfinance institutes (MFIs). Results from the case-study show, that onlyabout 6 % of the clients of the Dhan Foundation (NGO) stated to have access topension. This is in line with the national statistics. The pilot initiative for a micropension program of the Dhan Foundation, show a clear positive result in willingnessto pay for micro pensions among their mostly female clientele To improve thelow coverage rate, micropensions could be of significant added value in the socalled ‘multi-pillar approach’ that recognizes the complementarities between thestate pension, the private sector and the civil society sector pension plans.