The private voluntary pensions market exceeded the limit of 41,000 members in the second quarter of this year. 
According to data from the Financial Supervisory Authority (AMF), in mid-2024 the number of fund members reached 41,344 members, an increase of 8.3% since the beginning of this year and 10% compared to the same period of the year past. 
The number of individuals participating in private pension funds has been growing steadily over the last decade and is at historical highs. However, the penetration of private pensions remains at quite modest levels. Individuals who contribute to a private pension account for approximately 3.1% of the total number of employees in the country (according to the latest data published by INSTAT for quarter IV 2023). 
The value of net assets of pension funds at the end of June this year reached Lek 7.3 billion, increasing by 8.3% since the beginning of the year and by 17.8% compared to the same period last year. 
Pension fund assets are mainly invested in Albanian government bonds. In terms of asset value, the private funds market remains the smallest segment of the financial market in Albania. 
The new law "On private pension funds", which entered into force at the end of last year, has brought a significant increase in fiscal incentives for contributions to private pension funds. 
With the previous law, the maximum limit for tax benefits on contributions to private pensions is the smaller value, resulting from the comparison of the amount of Lek 200,000 and 15% of the member's gross annual income. 
According to the new law, the maximum monthly limit of the tax exemption has been increased to the level of the approved minimum salary, which has reached Lek 40,000 per month. 
With the current level of the minimum wage, the amount of tax-exempt contributions amounts to Lek 480,000 per year. Contributions and private pensions paid by the employer in favor of the employee will also be exempt from tax to the same extent. 
The law also provides that pensions are not taxed in the benefit for the part of the contributions, but only for the return on the investment, provided that the withdrawal is made with monthly payments spread over at least two years and not immediately, after fulfilling the legal conditions for private pension benefits. 
At the end of the second quarter, six private pension funds managed by four management companies were active in the private pension market.