Somporn Chitpentom, secretary-general of NSF, said yesterday that return on investment should reach 5-7 per cent next year, up from 2-3 per cent currently, when it can invest in the stock market.
The fund aims for a 10-15-per-cent weighting in SET 50 stocks.
At present, NSF’s portfolio is in fixed-income debt, mainly government and corporate bonds.
NSF wants to increase its weighting in corporate bonds from 10 per cent next year, but the investment picture for 2017 is murky, as the global economy is still experiencing volatility from the economic policies of developed countries including the United States, where Donald Trump will take over the administration next month.
NSF hopes to expand assets under management to Bt3 billion next year from Bt2.5 billion, but the growth will be driven by existing members rather than new ones.
NSF was launched in August last year to serve as a retirement safety net for 25 million self-employed workers not covered by a pension fund, Social Security or a provident fund.
People aged 15-60 are eligible to apply for NSF membership.
Thai citizens can register for the fund using their identity card and making a minimum deposit of Bt50. The maximum in deposits per year is Bt13,200.
Encouraging those people to apply for the fund is not easy because they don’t have much money and|the economic situation is not supportive. The fund has revised down the 2017 membership target to 1 million from 1.5 million.
A member has savings with NSF of Bt1,000 per year.
The uncertain future of agricultural-goods prices is a reason for low deposits, since half of the 520,000 NSF members are agricultural workers.
NSF has added the Government Housing Bank as the fourth channel to accept fund members and deposits from self-employed workers.
NSF now has three state-owned banks as partners – the Government Savings Bank, Bank for Agriculture and Agricultural Cooperatives and Krungthai Bank.
There are more than 25 million self-employed workers not covered by a pension fund, Social Security |or provident funds, but only 520,000 have applied for NSF member-ship.
The government also contributes to a member’s NSF account, but its share should be increased.
NSF will propose to the government ways to attract new members for consideration in the first quarter of next year.
At present, the government’s contribution for people aged up to 30 is 50 per cent of the member’s contribution. However, it is limited to Bt600 per year.
For those aged 31-50, the government’s contribution is 80 per cent, but not more than Bt960 per year. It provides 100-per-cent matching, up to Bt1,200 a year, for those aged over 50.
NSF plans to propose a new maximum government contribution of Bt1,500 to motivate self-employed people to apply to the fund. The maximum deposit should be expanded |to Bt15,000 from Bt13,200, Somporn said.
The conditions of deposits and the government’s contribution should be easy to remember, as this will help banks that are outlets of NSF to inform the self-employed more easily, he said.
Simple conditions will help the fund become better known among young people, who are the target of NSF, as this segment makes up less than 10 per cent of the 520,000 members, he said.