worldbank.org (29.05.2025) Pension systems globally have faced challenges in fulfilling their commitment to providing adequate financial security for individuals in their old age. In developing countries, pension coverage is often low, and benefits frequently fall below the poverty line. The design of the pensions systems, among other factors, tend to exacerbate informality, with only a fraction of formal workers receiving pensions. The low coverage and the little redistribution leads low wage workers to end up subsidizing high wage workers. The way contributions finance pensions contribute to the informality dilemma by creating a disparity between employer payments and worker benefits, perpetuating a cycle of low pensions, high informality, and discouragement of formal employment. For instance, in some MENA countries, if the worker does not accumulate enough years, he/she will forfeit the contributions from the employer. Governments, facing fiscal and debt sustainability pressures, struggle to enhance coverage and benefits. Bridging this gap between pension promises and realities is an urgent challenge requiring immediate attention.