PenCom registers 95,045 for micro pension with N435.6m contribution

By Cynthia Ezekwe

The National Pension Commission (PenCom) said it has registered 95,045 participants on the Micro Pension Plan (MPP) of the contributory pension scheme (CPS) and recorded a total contribution of over N435.6 million as of April 2023.

Dauda Ahmed, head of the micro pensions department, PenCOM, made the disclosure during a recent workshop organised by Labour Writers’ Association of Nigeria (LAWAN) in Lagos.

Ahmed, who spoke on the topic ‘Facilitating Financial Inclusion in the Informal Sector through the MPP’, said the total withdrawals stood at N30.3 million, while conversion from informal to formal was N6.51 million.

Highlighting some of the challenges bothering implementation, he noted that there is lack of adequate incentives to encourage participation, different competing products in the market with more flexibility towards access to funds. He also identified negative perception and trust deficit as challenges.

According to Ahmed, the demand to have workers financially inclusive as a tool for national development has become imperative, as statistics show that over 80 per cent of the country’s working population fall under the informal sector.

“We are driving processes to make it more acceptable. In the informal sector, there is a lot of money there, but how can you tap into it? It needs a lot of sustained awareness creation,” he said.

Ahmed also noted that having a financially inclusive informal sector serves as a vehicle for national development.

He concluded that the need for an urgent and effective policy, as well as regulatory response to large scale pension inclusion of the informal sector was desired to achieve at least 40 per cent pension participation.

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

Abdulqadir Dahiru, head of communications, PenCom, reiterated the Commission’s commitment to ensuring the safety of pension funds and the provision of excellent services to stakeholders through the implementation of various reforms.

Dahiru said as the pension industry and financial system evolve, the Commission would continue to develop to surmount the challenges facing CPS.