Joy Agwunobi
The National Pension Commission (PenCom) has cautioned all licensed Pension Fund Administrators (PFAs) against engaging in practices aimed at inducing Retirement Savings Account (RSA) holders, stressing that any violators will face immediate and stringent regulatory sanctions.
In a new circular signed by A. M. Saleem, director of the commission’s surveillance department, PenCom reiterated its long-standing prohibition of inducements in the transfer of RSAs.
The reminder specifically referenced an earlier directive issued on September 14, 2022 (Circular Ref: PENCOM/INSP/CIR/202/1810), which expressly bans PFAs from offering gifts, paying transfer commissions, or providing inducements of any kind—whether cash or non-cash—to sway the transfer decisions of RSA holders.
“The Commission hereby emphasises its zero tolerance for any form of inducement,” the circular stated. “Accordingly, any PFA found offering, granting, or facilitating financial or non-financial inducements to influence an RSA holder’s decision to transfer or not transfer his/her RSA shall be immediately barred from receiving RSA transfers.”
PenCom added that, beyond barring defaulting administrators from receiving transfers, it would also impose additional sanctions in line with its Framework for the Regime of Sanctions, which governs penalties for regulatory breaches. The commission made clear that this new addendum to its earlier directive takes immediate effect.
The move reflects PenCom’s increasing oversight of Nigeria’s contributory pension scheme, where transfers of retirement savings accounts have become more common since the introduction of the RSA transfer window.
The latest warning follows a similar notice issued last month, in which PenCom cautioned financial institutions and employers against interfering with the pension choices of their employees. The regulator said it had observed “illegal and unethical practices” where some organisations and their vendors compelled workers to open or transfer RSAs to PFAs with direct or indirect affiliations to the employer, or to those linked through custody of pension assets by Pension Fund Custodians.
