The Nigeria pension scheme has experienced a significant turning point, characterized by bold regulatory reforms poised to reshaping the industry’s landscape. Under the new leadership at the National Pension Commission (PenCom) some bold reforms relating to the administration of retirement benefits and the remittance of pension contributions have been launched. Ms. Omolola Oloworaran, the new Director General of the Commission, who is the chief driver of the changes has demonstrated uncommon commitment to an efficient and technology-driven pension administration system.
One of the major changes just introduced is the granting of full authority to PFAs to process and approve retirement benefit applications. The new arrangement which takes effect from June 1, 2025, empowers PFAs to process pension payments like Programmed Withdrawal, Temporary Loss of Employment benefits, Pension Mortgage, and Voluntary Contribution benefits, among others. The PFAs are however required to secure approval from the Commission for death benefit applications and payments relating to depleted RSAs. Prior to this new development, Pension Fund Administrators (PFAs) were required to obtain approval from PenCom for various benefits applications.
The second major development is the engagement of 9 approved Payment Solution Service Providers (PSSPs) for remitting pension contributions of workers to the RSAs. This initiative aims to resolve the persistent issue of industrywide unreconciled contributions running into billions of Naira. Employers will now have the option to choose from any of the nine (9) Payment Solution Service Providers that have been approved by PenCom for remitting pension contributions and uploading pension schedules of their workers.
The approved PSSPs include PAYPEN by Netline Limited, PENCENTRAL by Chamsaccess Limited, PENSPHERE (formerly PAYTHRU) by Pethahiah Rehoboth Int’l Limited, PENREMIT by Cyberspace Limited. Others are PENSOL by Uniswitch Technology Limited, PENCO by Gemspay Solutions Limited, AWABAH by Awabah Remit Services Limited, EPCOSS by Nigeria Inter-bank Settlement Systems Plc, and INTERSWITCH by Interswitch Group.
The new payment system allows for only compliant remittances with matching RSA Personal Identification Numbers (PINs) and PFA codes. It also introduces real-time error-checking protocols and various gateways for instant online payments. The Commission has set 1st June 2025 as the deadline for full compliance. From this date, all other platforms will be disabled, leaving only the approved PSSPs. Employers are required to adopt the new process and ensure that their pension contributions are remitted through the approved PSSPs.
According to the Mr. Godson Ukpevo, OON, Managing Director/CEO of Veritas Glanvills Pension Limited, “these reforms mark a significant shift towards a more robust and efficient pension administration system in the country. The reforms will certainly bring a lot of salutary effect and benefit to CPS contributors and retirees”
