Georgia’s new pension system comes into play

Starting from January 1, 2018 the accumulated pension system is mandatory for legally employed people under 40. Photo: N. Alavidze/, 03 Jan 2019 - 15:59, Tbilisi,Georgia

This month, the employed in Georgia will transfer money to the country’s pension savings system for the first time, as it was launched on January 1, 2019.

Starting from January 1, 2019 the accumulated pension system is mandatory for legally employed people under 40, meaning they will be enrolled automatically. For the self-employed and those above the age of 40, enrolment in the programme is voluntary.

The special website and the national system of pension deposits administration were launched today to allow citizens to better administer their funds accumulated in the pension system.

The pension savings system applies to Georgian citizens, foreign citizens living in Georgia with permanent residency in the country and stateless persons who are employed or self-employed and receive an income. This system applies to employees of both the public as well as private sectors.

The system will work on a 2+2+2 scheme. Each employee, employer and the government will make a contribution of 2% of the gross volume of the employee’s income to an individual retirement account. As for the self-employed, they will make a deposit of 4% of their income, and the state will match another two per cent. 

The new law on pension savings does not envisage the annulment of the current pension system.

On January 1, 2018 pensions increased by 20 GEL in Georgia and amounted to 200 GEL monthly.