Where Angels Prey

Where Angels Prey is a novel by Ramesh S Arunachalam. Please refer to www.whereangelsprey.com for more information

Wednesday, February 23, 2011

Old Age Security Scheme (OASS) of SIFFS – An Informal Micro-Pension Scheme in India

Ramesh S Arunachalam

Rural Finance Practitioner

There is an informal scheme, in the fisheries sector, which SIFFS has been running as a long term savings scheme called as OASS – Old Age Security Scheme. As per the scheme, a sea going fisherman can get a pension from age of 60 but he is required to save Rs 50 per month until then.

SIFFS was managing the OASS but was looking for a professional fund manager to help manage these in the long term. The scheme was started in 2001 as a part of the SIFFS microfinance program. The voluntary saving scheme has completed 10 years in 2011 and it has been promoted very much in Tamil Nadu and Kerala region.

The flow of money in the SIFFS OASS is given in figure 1 below:

This saving scheme is intended to help the artisanal fishermen to accumulate a lump sum at the time of retirement from fishing. The salient aspects are:
·       OASS is designed for the fishermen community as a long term pension scheme
·       Any person with membership in SIFFS society can join in the scheme but he has to be an active sea going fisherman
·       Minimum eligible age to join is 18 years and up to retirement age of 60
·       Multiples of Rs.50 can be remitted as premium amount (e.g., 100,150,200)
·       Penalty for defaulters exists and it varies by type of default/delinquency
·       Interest is generally linked to the post office interest rate on savings
·       Option for withdrawal of deposit on death, membership closure but based on certain conditions.

The deposit growth chart is given in table below

Several aspects appear to have helped SIFFS be successful in its OASS scheme:
·       Long term trust of fisherman in societies
·       Long term trust of fishermen in their federations/SIFFS
·       Several other aspects including social acceptability of SIFFS and its member societies/federations, availability of local information, a dedicated team of staff and other factors like a convenient product, which is priced well and distributed appropriately backed by good governance, transparent systems and prudent management.


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