According to the statement made by the Insurance Association of Turkey (TSB), with the regulations that allow those under the age of 18 to participate in the Private Pension System (BES), there has been a dynamism in the sector.
Looking at the Pension Monitoring Center (EGM) data for those under the age of 18, announced as of September 10, 2021, the rate of contracts for children under the age of 1 is around 7 percent, while the number of contracts for children under the age of 10 is 70 percent for those under the age of 18.
In terms of fund size, the fund size of children under the age of 1 corresponds to 4 percent of the total amount in this area, while the fund size of children under the age of 10 covers 54 percent of the total fund size of children under the age of 18.
Fund size reached 190 billion liras
TSB President Atilla Benli, whose views are included in the statement, said that the total number of participants in the PPS and automatic enrollment reached 13 million, and the total fund size, including the state contribution of approximately 24 billion TL, is approximately 190 billion TL. explained.
Pointing out that the success graph in the sector is increasing day by day, Benli said, “The trust of our citizens towards the Private Pension System is increasing exponentially day by day. Our excitement is great. We anticipate that the total fund size of the system will reach 200 billion TL by the end of the year, with the support of our children under the age of 18 and automatic enrollment.” said.
Reminding that with the changes made at the end of May, PPS contracts started to be issued to participants under the age of 18, Benli said that until 10 September 2021, nearly 50 thousand contracts were issued by 11 pension companies and that the fund size of these contracts amounted to TL 44 million, which was started to be deposited into participant accounts as of July 2021. He noted that the state contribution exceeded 3 million TL.
Noting that parents are conscious and willing to invest for their children, Benli said, “We see great favor from our citizens regarding PPS under the age of 18. In the future, if there are incentives such as bringing the retirement age forward in the system or early entitlement to the state contribution, we may see even more serious increases in the interest in this field.” made its assessment.
11 pension companies under the age of 18 took BES into their portfolio
While evaluating the recent developments in BES and automatic enrollment, Atilla Benli stated that as the umbrella institution of the sector, they continue to work to provide added value to the Turkish economy, to expand the insurance sector, to popularize the use of products, to develop products in favor of the insured and to guide the sector in these areas.
Benli stated that paving the way for young people under the age of 18 to participate in the PPS is a result of these efforts, and said, “PPS under the age of 18 is a study that we attach great importance to in terms of preventing the loss of welfare in retirement, increasing national savings and the growth of the sector by gaining the habit of saving at young ages. . We are pleased with the interest we have seen in the first three months, currently 11 pension companies have included the product in their portfolio. We think that with the participation of all pension companies in the process, the great potential here will emerge more clearly.” used his statements.
“We observed an increase of nearly 300 thousand in the number of employees in the system during the summer months”
Benli stated that the number of participants in the PPS approached 7 million, and the fund size reached approximately 176 billion TL with the state contribution of approximately 23 billion TL.
Benli, who stated that the fund size reached 14.5 billion TL with the state contribution exceeding 620 million TL in the automatic enrollment application, which started in 2017, said, “There are currently over 6 million employees who continue to save in the system. Especially in the summer months. “We have observed an increase in the number of employees close to 300 thousand. We think that we have seen the positive effects of the increase in the number of employees employed with the stretching of the epidemic measures.” made its assessment.