Ground-breaking new research identifies policy incentives that can lift pension participation among informal workers in developing economies from under 1% to more than 15% – offering a pathway to reduce old-age poverty for billions of people.

• Institute publishes landmark policy research report: The Coller Pensions Institute publishes new policy research in collaboration with D3P Global, investigating the critical, but often-overlooked, area of how to incentivise informal workers to save for a pension – analysing how policymakers in 11 developing countries have tried to boost participation.
• Majority of global workforce: From market traders to taxi drivers and domestic help, a majority (58%) of global labour now works in the informal sector. Most are in the developing world, where less than 1% of the informal labour force typically contributes to a pension. Around 2.2 billion people face poverty in old age with no pension.
• Pensions time bomb: This is a problem for national economies as well as individuals. Countries miss the benefits of pension fund investment into the economy at large, and pension systems, especially in countries with generally young populations, will face severe fiscal pressures in 40-50 years if pension system capacity is not built.
• Incentives that work: The Institute’s report reviews pensions programmes in 11 emerging and developing economies from Malaysia to Mexico to consider which incentives – from free insurance to ‘second generation’ auto enrolment – have helped boost participation in pensions. Schemes in Malaysia, Rwanda and Thailand have successfully reached around 15% of the informal workforce using a range of incentive systems.

London, 19 February 2026: The Coller Pensions Institute, a non-profit pension action tank founded by private equity investor Jeremy Coller as part of his Foundation, has published a landmark first research investigation reviewing how policy incentives can boost pensions for informal workers. The report issues 20 recommendations for pension policymakers that could improve the lives of millions of informal workers globally when they retire.

The report, by the Coller Pensions Institute in collaboration with D3P Global, analyses how pension programmes in 11 emerging and developing economies have tried to incentivise greater participation. It assesses the use of financial incentives such as ‘matching contributions’, ‘auto-enrolment’, ‘flat-rate contributions’, ‘bundled products’ and ‘guaranteed returns’. It considers which policies, given the right enabling conditions, might get more informal workers to put money aside for long-term savings.

Very few countries succeed in getting more than 1% of informal workers to contribute to a pension but the report highlights systems in Rwanda, Malaysia and Thailand that have all succeeded in attracting around 15% of the informal workforce to participate. A majority(58%) of the global labour force now work in the informal sector, rising to 90% in low-income countries. In developing countries however less than 1% of the informal labour force typically contributes to a pension, and around 2.2 billion people face poverty in old age with no pension.

This is a problem for both individuals and national economies. Countries without well-funded schemes miss the benefits of pension fund investment in areas such as national infrastructure, and as people live longer, under-funded pension pots will be stretched ever thinner. Countries with generally young populations – such as many African countries – face a demographic cliff in 40-50 years if pension system capacity is not built.

Jeremy Coller, Founder and Chairman, Coller Pensions Institute, said:

“Well-constructed pension schemes can unlock a future in which developing nations reduce their reliance on aid and grow their economies. But that can only happen if workers have the incentives they need to contribute regularly to a pension.

How to achieve that in countries where a majority of the workforce is in the informal sector is a problem policymakers need to solve if we’re serious about eradicating old age poverty worldwide – so I’m delighted that this vital and timely paper provides pragmatic and evidence-based solutions.”

Fiona Reynolds, President, Coller Pensions Institute

“Population ageing is steadily increasing the pressure on pension systems, yet millions of informal workers remain excluded. Unless pension systems adapt to engage informal workers — particularly women, who are over-represented and under-protected — today’s slow-burn problem will become tomorrow’s crisis. This research identifies the levers policymakers can use to design pension systems that informal workers actually want to join.”

David Pinkus, Director, Coller Pensions Institute:

“This comprehensive paper puts forward innovations and ideas to help policymakers support more informal workers to save, building on the opportunity of digitalisation and a second generation of pension reforms. When it comes to income security in old age, we cannot afford to leave 2.2 billion informal workers behind. Well-designed funded pension systems, under the right enabling conditions, can also support long-term economic growth, mobilise domestic savings, and therefore reduce reliance on international aid. We have the tools and insights – now we need political will, funding, and coordination to bring fair pension coverage within reach for all.”

Will Price, CEO of D3P Global:

“This is an important report addressing one of the toughest challenges we find in our work globally. I genuinely believe its insights on second generation reforms can help countries expand coverage, be fiscally sustainable and deliver a real chance for millions to have a decent old age.”

The report looks at incentives that are not based on the tax system – as informal workers tend to work outside of the tax system – and argues that all policies need the right enabling conditions in order to succeed. Based on its detailed analysis, the report makes 20 recommendations for policymakers when designing pensions for the informal sector. This include:

• Matching and flat-rate incentives are essential if informal sector workers are to be persuaded in significant numbers to use pensions to boost income in old age. Türkiye (Turkey) is an example – in 2013 it replaced tax incentives with matched contributions of 25% and saw the number of pension accounts rise from 2 million to 4.5 million in 3 years.
• The impact of incentives can be maximised by using ‘second generation’ auto-enrolment. A good example is Ghana where in 2024 the cocoa farmers association (COCOBOD) launched a national pension plan for over 500,000 farmers that automatically diverts 5% of a farmer’s sales from the centralised purchasing arrangements into a pension plan – with farmers receiving a 20% match from the cocoa board.
• Incentives should be designed with a clear gender lens to help address pervasive barriers to equal pension outcomes for women. For example, the i-Suri scheme in Malaysiaprovided a 50% matched contribution for low-income married women in 2018 and saw accounts grow strongly to over 200,000 women.
• Policymakers should consider bundling long-term saving with incentivised short-term products, such as insurance coverage tailored to the target population. For example, Rwanda’s Ejo Heza plan for informal workers included bundled insurance for funerals and other benefits which helped it grow to over 3.2 million accounts (as of June 2024) – approximately 87% of which were from the informal sector.

>> The full report is available here.

>> A short summary is available here.

Notes to editor

• For further information, or for interviews with Coller Pensions Institute contact: infocpi@jeremycollerfoundation.org 

About Coller Pensions Institute

The Coller Pensions Institute is an independent, non-profit pension action tank. While the need for pension reform is often only seen as a challenge, we believe it also brings unique opportunities. Our mission is to develop and implement innovative policies to expand pension coverage, promote sustainable economic growth and reduce old-age poverty.

About D3P Global

D3P Global build better pension systems, bringing world-class insights to our partners that radically boost pension outcomes. We want more people getting decent pensions that are sustainable, secure and efficient. We strongly believe that when experts in diagnosis, design and delivery come together they create designs that work and delivery that can transform lives.