The Stock Exchange of Thailand (SET) will make a soft launch for a fund link online system on the Settrade platform by June to encourage people to build a retirement nest egg.
Kesara: Thais need to build nest egg
With the system, investors can buy both stocks and mutual funds on a monthly basis for retirement, said president Kesara Manchusree.
Thailand is an ageing society and needs to promote financial and investment literacy among its citizens to make them appreciate savings so they will have enough money for a comfortable life in retirement, she said.
"However, a mere 38% of 40 million salaried workers are covered by the retirement safety net [meaning they are members of a pension fund, the Social Security Fund, the National Savings Fund (NSF), or a provident fund]. And even being a member does not guarantee they will have enough money after retirement," said Mrs Kesara.
Even though 656 listed companies are offering 1.2 million of their employees provident fund coverage, the SET found that savings in provident funds are still insufficient and the right investment planning is crucial to boost savings, she said.
The cabinet recently approved the establishment of the long-awaited mandatory provident fund to strengthen the country's retirement safety net and ease the government burden for an ageing population. The fund is set to begin in 2018.
Apart from the mandatory provident fund, the government has set up the NSF, a voluntary pension fund for self-employed workers.
The percentage of Thais aged 60 and over is expected to increase from 14% of the population to 17.5% in 2020 to 21.2% in 2025 and 25.2% in 2030, estimated the Fiscal Policy Office.
To promote retirement savings, the SET has partnered with the Association of Securities Companies and the Thai Listed Companies Association to launch a savings scheme to build up investment discipline, said Mrs Kesara. She said the programme will offer online investment education and offer advice based on users' risk tolerance.
"We set a target for monthly retirement contributors to rise by 10,000, with 10,000 stock trading accounts opened every year," said Mrs Kesara.