Detailed Guide to Nepal’s Social Security Fund (SSF)

Nepal’s Social Security Fund (SSF), known as Samajik Suraksha Kosh in Nepali, is a transformative initiative aimed at ensuring financial and social protection for workers across various sectors. Established under the Social Security Act, 2018 (2075 BS) and operational since August 1, 2019 (2076 Shrawan 1 BS), the SSF provides benefits like healthcare, maternity support, accident and disability coverage, and old-age pensions. This guide offers a detailed, user-friendly overview of the SSF, covering its purpose, eligibility, registration process, contribution details, benefits, and challenges, ensuring easy navigation for you.

What is the Social Security Fund (SSF)?

The SSF is a government-administered program under the Ministry of Labour, Employment, and Social Security (MoLESS) designed to provide financial and social security to workers in Nepal. Its primary goal is to reduce economic risks associated with contingencies like illness, workplace accidents, maternity, and retirement, ensuring a safety net for workers and their families. The SSF is a contributory system, meaning both employers and employees contribute a percentage of the employee’s basic salary to fund the benefits. It initially targeted the formal sector but has expanded to include informal and self-employed workers, as well as Nepali citizens working abroad.

Key Objectives:

• Provide healthcare, maternity, and accident coverage.
• Ensure old-age financial security through pensions.
• Support families of workers in case of death or disability.
• Promote a safe and secure work environment.

By the end of 2023, the SSF had registered 18,554 employers and 1,022,896 contributors, reflecting growing participation.

Legal Framework and History

The SSF operates under the following legal provisions:

• Constitution of Nepal (2015): Article 34 guarantees the right to contribution-based social security.
• Social Security Act, 2018 (2075 BS): Enacted on August 13, 2017, and effective from November 11, 2017, it mandates employer and employee registration with the SSF.
• Contribution-Based Social Security Regulations, 2018: Outlines procedures for participation, registration, and fund operation.
• Labour Act, 2017: Sections 52–56 detail provident fund, gratuity, and compliance requirements.
• SSF Operational Guidelines: Include the 2018 guideline for formal sector workers, and 2022 guidelines for informal, self-employed, and foreign employment workers.

The SSF was formally established in 2011 under the Social Security (Management Fund and Operation) Regulations, 2067 BS, but contributions began on August 1, 2019. It is managed by a 13-member tripartite board chaired by the Secretary of MoLESS, including representatives from government, employers, and trade unions.

Who Can Participate in SSF?

The SSF is inclusive, covering a wide range of workers:

• Formal Sector Employees: All employees in registered businesses (private or public) must enroll.
• Informal Sector Workers: Small business owners, freelancers, and domestic workers can voluntarily register.
• Self-Employed Individuals: Can contribute voluntarily to access benefits.
• Migrant Workers: Nepali citizens working abroad can opt in for healthcare and pension benefits.
• Foreign Nationals: Eligible to participate with no distinction from Nepali workers.
• Exemptions: Security agencies (e.g., Nepal Army, Nepal Police) and civil service employees are exempt.

Note: Participation is mandatory for all business enterprises and their employees, except exempted sectors. Independent consultants are not required to enroll.

SSF Schemes and Benefits

The SSF offers four key schemes to protect workers and their families:

Medical Treatment, Health, and Maternity Protection

• Coverage: Includes medical treatment, hospital stays, medicines, prenatal, delivery, and postnatal care for contributors and their spouses.
• Eligibility: Contributors who have paid for at least 3 months are entitled.
• Hospital Requirements: Treatment must occur at hospitals with a Memorandum of Understanding (MOU) with SSF.
• Claim Process: Payments to health institutions are processed within 30 days of document submission.

Accident and Disability Protection

• Coverage: Up to NPR 700,000 for workplace accident-related treatment. Non-MOU hospitals require notification within 7 days of the accident.
• Disability Benefits: Determined by a fund subcommittee, including a medical officer.
• Double Insurance: If other insurance covers part of the cost (e.g., NPR 300,000), SSF can cover the remaining amount (e.g., NPR 400,000).

Dependent Family Security

• Coverage: Provides financial support for dependent children’s education and family security in case of a contributor’s death.
• Spouse Benefit: If a contributor passes away, their spouse receives 40% of the pension for life.

Old-Age Protection (Pension and Retirement)

• Pension: Contributors retiring after 15 years of contributions receive a monthly pension calculated by dividing the total contribution (plus accrued interest) by 180 months.
• Lump Sum: If contributions are less than 15 years, a lump sum is provided.
• Pre-Enrollment Options: Employees can transfer existing provident fund/gratuity to SSF, cash out, or maintain it in existing retirement funds.

Note: Existing benefits (e.g., gratuity) are not reduced upon SSF enrollment, as per Sections 52–54 of the Labour Act, 2017.

Contribution Structure

The SSF requires a total contribution of 31% of an employee’s basic salary, split as follows:

• Employee Contribution: 11% (10% provident fund + 1% social security tax).
• Employer Contribution: 20% (10% provident fund + 8.33% gratuity + 1.67% medical insurance).
• Informal Sector: Workers contribute 9.37%, matched by the government.
• Allocation:
  • Medical, Health, and Maternity: 3.22%
  • Accident and Disability: 4.52%
  • Dependent Family Security: 0.87%
  • Old-Age Security: 91.39%

Frequency: Contributions must be deposited monthly within 15 days of the previous month’s end.
Payment Method: Online via Connect IPS to SSF’s account at Nepal Bank Limited (Account No: 00211606720012000002).

Registration Process

Employer Registration

• Mandatory: All businesses must register with SSF upon incorporation (post-2076 BS) or within deadlines set by earlier notices.
• Process:
  1. Visit https://sosys.ssf.gov.np.
  2. Complete the online application form with company details (e.g., Company Registration Certificate).
  3. Receive an SSF certificate within 2 days.
• No Fee: Registration is free.

Employee Registration

• Timeline: Employers must register employees within 3 months of hiring or establishment of the employment relationship.
• Process:
  1. Employers submit employee details via the SSF online portal.
  2. Employees receive a unique SSF number and social security card.
• Outsourced Employees: The outsourcing company is responsible for registration.

Online Portal and SSF Number

• Access the SSF portal at https://sosys.ssf.gov.np to:
  1. Register as an employer or employee.
  2. Check contribution status or claim benefits.
  3. Log in using the unique SSF number.
• Login Steps:
  1. Select “Contributor” or “Employer” login type.
  2. Enter SSF number, username, and password.
  3. Reset passwords if needed via the portal.

How to Claim SSF Benefits

1. Obtain SSF Number: Ensure you have your unique SSF number and social security card.
2. Submit Documents:
   • For medical/maternity claims, treatment must be at MOU hospitals, with documents submitted within 30 days.
   • For accident claims, notify SSF within 7 days if using a non-MOU hospital.
   • For pension/lump sum, apply post-retirement or resignation via the SSF portal.
3. Verification: SSF verifies documents and processes claims, typically within 30 days.
4. Contact SSF: Visit SSF offices or email info@ssf.gov.np for assistance.

Tax Benefits and Incentives

• Tax Deduction: Employees can deduct up to NPR 500,000 or one-third of taxable income (whichever is lower) for SSF contributions.
• No Additional Tax: The 1% social security tax is included in the 11% employee contribution, avoiding double taxation.
• Employer Benefits: SSF enrollment reduces employer liability for compensation in cases of workplace accidents or death.

Challenges and Criticisms

Despite its benefits, the SSF faces challenges:

• Low Enrollment: Many private firms and employees remain unregistered due to misinformation or distrust.
• Employee Concerns: Fears of losing existing benefits (e.g., gratuity) or reduced take-home pay due to contributions.
• Banking Sector Resistance: Employees in banks and financial institutions argue that existing welfare funds are more beneficial.
• Operational Issues: Initial delays in benefit delivery (e.g., during COVID-19) and unclear policies caused skepticism.
• Legal Disputes: A 2021 Supreme Court interim order made SSF participation optional for some bank employees pending a final verdict.

Government Response: The SSF has issued notices to enforce compliance, linking registration to company renewals and tax clearances.

Recent Updates (2025)

• Expanded Coverage: Informal and self-employed workers, as well as migrant workers, are increasingly enrolling due to 2022 guidelines.
• Technology Integration: The SSF portal is now more user-friendly, with mobile app access for contributors.
• Compliance Enforcement: Companies must show SSF compliance for registration renewals and tax clearances.
• Budget Concerns: The government faces challenges in funding matching contributions for informal sector workers.

Frequently Asked Questions (FAQs)

Q: Is SSF participation mandatory?
A: Yes, for all registered businesses and their employees, except exempted sectors like security agencies. Independent consultants are exempt.

Q: What happens if an employer fails to register?
A: Employers face penalties, including 10% interest on unpaid contributions or liability for benefits employees would have received.

Q: Until what age must I contribute?
A: Until age 60. A minimum of 15 years of contributions is required for a pension; otherwise, a lump sum is provided.

Q: Can I transfer existing provident funds to SSF?
A: Yes, employees can transfer pre-enrollment provident funds/gratuity, cash out, or maintain them in existing funds.

Q: How do I check my SSF status?
A: Log in to https://sosys.ssf.gov.np using your SSF number.

Contact Information and Resources

• SSF Office: Babarmahal, Kathmandu, Nepal
• Phone: +977-01-5970016, +977-01-4260851
• Fax: +977-01-4255463
• Email: info@ssf.gov.np
• Website: https://ssf.gov.np
• Contributor Portal: https://sosys.ssf.gov.np
• User Guidelines: Available at SSF Guidelines.