By Sola Alabadan

After having restructured and rebranded the Micro Pension Plan into the Personal Pension Plan, the National Pension Commission has simplified onboarding, expanded digital enrolment, and crucially introduced Accredited Pension Agents.

PenCom’s Director General, Ms Omolola Oloworaran, who disclosed this at the 2025 Media Conference in Lagos, clarified that the Accredited Pension Agents are not merely distribution channels, but an employment strategy as thousands of young Nigerians are expected to be trained, certified, and deployed as pension professionals, earning livelihoods, while expanding pension coverage.

The Commission is also excited by the Presidential approval and disbursement of N758 billion to settle outstanding pension liabilities, saying “This unprecedented intervention sent a clear and powerful signal that Nigeria honours its promises to its workers and retirees.”

Similarly, PenCom equally cleared long-standing pension increase backlogs for Federal Government treasury-funded retirees, some dating as far back as 2007.

The PenCom boss added that “zero waiting time for the payment of accrued pension rights was restored with effect from July 2025. Today, retirees receive their benefits when due, not months or years later.”

“To further enhance benefit adequacy, we introduced Pension Boost 1.0, which has already added N2.68 billion to monthly pension payments for CPS retirees.

“On the technology front, we achieved full automation of critical pension processes, including the Pension Clearance Certificate system, benefit processing, and contribution remittance platforms.

“Operational efficiency has improved, leakages have reduced, and transparency has increased. We will continue to upgrade our systems and application as technology evolves.

“We also inaugurated the Board of Trustees of the PenCare Initiative, a landmark industry-wide intervention to provide free and accessible healthcare for low income retirees. Retirement should be a season of peace, not a period defined by anxiety over medical bills.

Speaking on the fact that pension operators were asked to raise their capital requirements, she maintained that this was not punitive but purposeful, stressing that stronger capital means stronger institutions, better risk management, deeper expertise, and a greater capacity to attract and retain skilled professionals.”

“We also strengthened governance regulations to eliminate shadow directorships. Let me state this clearly. Pensions cannot be managed from the shadows. Transparency, accountability, and fit-and-proper leadership are non-negotiable. A system entrusted with Nigerians’ life savings must be governed by integrity and competence,” she further stated.

With regards to the compliance circular issued by PenCom in the second quarter of this year, linking Pension Clearance Certificates to participation across the pension industry value chain, she said that the impact was immediate and unmistakable, pointing out that “From January to November 2025, total pension recoveries reached N4.04 billion, compared to N1.44 billion for the whole of 2024. This represents an increase of over 180 percent. Most notably, N2.06 billion was recovered in the third quarter of 2025 alone, almost 150% of total recoveries recorded in the entire year 2024.

“A similar shift is evident in compliance behaviour. Prior to the third quarter, Pension Clearance Certificates were issued at a modest quarterly average of about N150 billion. Following the circular, the third quarter recorded issuances of about N233 billion, far exceeding the average of preceding quarters. This clearly demonstrates that when compliance is tied to real economic consequences, behaviour changes.”

‎The Managing Director/Chief Executive Officer, Arthur Stevens Asset Management Limited, Mr. Olatunde Amolegbe, has tasked operators in the insurance and pension sectors to come up with strategies that will bring the full informal sector under insurance and pension coverage.
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‎Amolegbe, who gave this charge at the 10th Annual Conference of the Nigerian Association of Insurance and Pension Editors (NAIPE) in Lagos recently, with the theme “Strengthening Pension and Insurance Framework for Better Economy” noted that the informal sector constitute about 70 million Nigerian working population.
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‎He identified the two sectors as key sub-sectors of the financial services industry of the economy that have capacity to accumulate long term investible funds.
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‎He however, regretted that both sectors for years, have been suffering from under development due to lack of public confidence and trust as well as poor awareness of the value of the sectors on the part of the public.
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‎Highlighting the underdeveloped nature of the two sectors, Amolegbe said pension and insurance coverage remained low, observing that only 26.3 percent of Nigerian workers had access to pension plan and health Insurance in 2023 largely due to the high number of informal sector workers in the country.
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‎“Approximately 92 percent of Nigeria’s employed population works in the informal sector, voluntary Micro pension scheme adoption has been low as of December 2024. Micro pension registration was barely 172.936 six years after the introduction of the scheme, for the inclusion of the informal sector”.
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‎On insurance performance he said “Nigeria’s insurance penetration remains largely low at less than 1.0 percent compared to South Africa ‘s 11.54 percent, Namibia’s 7.41 percent Morocco’s 4.10 percent, Kenya’s 2.25 percent and the global average of 6.8 percent,” he observed.
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‎To address the problem, he said the operators’ first step towards capturing the informal sector into insurance and pension fold was to rebuild their confidence and trust towards the sector.
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‎He said this was necessary because without regaining their confidence they could not be captured into pension and insurance nets because they would not want to put their money where they could not easily access it.
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‎He also urged operators of the two sectors to device simple and different system of enrolling the informal sector operators into the system using modern technology.
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‎He said operators of pension sector should begin to think how to establish micro PFAs and operate such firms in areas where micro people live.
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‎He urged insurance operators to use the opportunity of publicity created by the NIIRA 2025 to promote financial literacy among young Nigerians and make people have feelings for savings through insurance and pensions.
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‎Highlighting statistics on the performance of the two sectors between 2020 and 2024 Amolegbe said: “The pension and insurance sectors have recorded substantial growth, positioning them as critical pillars for economic stability and capital market deepening. Total pension assets reached over ₦23 trillion in 2025, equivalent to approximately 8.6 percent of GDP. Between 2020 and 2024, public sector contributions rose by 71.7 percent to ₦5.89 trillion, while private sector contributions grew by 65.7 percent to ₦5.42 trillion. In the fourth quarter of 2024 alone, contributions totaled ₦342.23 billion, with total Assets under Management standing at ₦22.51 trillion. Retirement Savings Account registrations rose by 14.8 percent over five years to 10.58 million accounts, and the Micro Pension Plan attracted ₦1.06 billion in cumulative contributions, highlighting the untapped potential of the informal sector”, he stated.
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‎He noted that the insurance industry achieved a 56 percent increase in gross written premiums in 2024, reaching ₦1.562 trillion, with the non-life segment accounting for ₦1.1 trillion and the life segment ₦470 billion. Industry assets rose by 46.1 percent to ₦3.9 trillion, while market capitalisation climbed 41 percent to ₦1.2 trillion. Net claims paid totaled ₦622 billion, with growth driven by fire, oil, gas, and group life products. He however noted that penetration remained below 1 percent far behind regional peers such as South Africa, Namibia, Morocco, and Kenya. He highlighted benefits of pension as driving long term investment, reducing poverty level among the elderly, promoting social stability and reducing dependency on family and government.
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‎He also highlighted insurance benefits as mitigating financial risks, and enabling businesses to invest and grow with confidence, promoting economic stability by compensating losses from unforeseen events and attracts foreign investment by offering risk coverage, boosting capital inflows among other benefits.

The National Pension Commission (PenCom) has informed that it would be redesigning the Micro Pension Plan to ensure that more people join the pension scheme, especially as majority of the working populace in Nigeria are in the informal sector.

This was disclosed on Tuesday in Lagos, at the 2025 Annual Conference of the Nigerian Association of Insurance and Pension Editors, with the theme, “Strengthening Insurance and Pension Frameworks for Better Economy.”

Micro Pension Plan is an arrangement under the Contributory Pension Scheme that allows the self-employed and persons working in organisations with less than three employees to make financial contributions towards the provision of a pension for their retirement or upon incapacitation.

Speaking at the conference, the Director-General, PenCom, Ms Omolola Oloworaran, who was represented by Head, Corporate Communications, PenCom, Mr. Ibrahim Buwai, averred that the majority of the Nigerian workforce was in the informal sector.

He said, “Let’s talk about this issue of expanding the Contributory Pension Scheme towards increasing financial inclusion to grow the informal sector. Even though the data out there of the Nigerian labour force says 70 million or 80 million, be that as it may, the consensus there is that the labour force out there largely resides in the informal sector.

“How do we bring the informal sector under the contributory pension scheme? It is even more important in a country like Nigeria, where the social safety net is not that strong. So, pension is what will come in handy in terms of providing that social safety net.”

The Micro Pension Plan was launched in 2019 by PenCom, but unfortunately, it has not gained much traction as it has only about 200,000 contributors registered under that plan with an asset of about a billion naira, which is very insignificant.

“What we are doing now is looking at totally redesigning that product. And in the next few weeks, we are going to come out with a newly branded micro pension plan now called Personal Pension Plan. We recognise the issues with the product. One of the key element of the product is that that product is going to be stratified into three strata, because we recognise that the sector is not micro. It does not only capture people who are down the ladder- the artisans and so on, it also takes care of people who are up there, the entertainers, the sportsmen who are doing a one man thing. These people need to be taken care of in the plan and there will be a section in the new plan for them.

“But the most important thing is to address the challenges especially around onboarding. I am happy because even the keynote speaker mentioned technology-enabled onboarding, so that is part of what we are looking at. We will put technology in place so that onboarding can be as simple as going to the POS to withdraw or lodge money,” Buwai said.

The PenCom spokesperson also disclosed that with the increase in FinTech, the regulators were considering adding a Super Agent who would come in and do the onboarding on behalf of the PFAs.

“This speaks to the issue that we need to license Micro Pension PFAs so that this model will enable us to achieve that purpose,” he noted.

Regarding the deployment of pension fund to economic development, PenCom said that it was one area it was focusing on.

“At the moment, we are renewing impetus to ensure that pension funds are invested in infrastructure, private equity etc. This is a two-pronged approach. Apart from the issue of economic development, we are also worried about the real return on investment for the benefit of the retirees and contributors. We are also aware that the recent inflation bite seems to reduce the real purchasing power and that is what is affecting the retirees also.”