The drive to bring Nigeria’s self-employed and informal-sector workers into the pension system is producing a worrisome imbalance as hundreds of thousands are opening retirement savings accounts, but only a small fraction are actually putting money into them.
About 91.4 percent of Retirement Savings Accounts (RSAs) registered under the Personal Pension Plan (PPP) had received no contributions by the end of the first quarter of 2026, according to the National Pension Commission (PenCom).
The commission’s first-quarter industry report showed that 219,316 PPP accounts had been registered by March, but only 18,811 accounts, representing 8.58 percent, had received contributions. This left 200,505 registered accounts without funding.
The figures expose a significant conversion challenge for Nigeria’s pension industry at a time when the value of retirement savings is expanding rapidly and policymakers are seeking to deepen pension coverage among workers outside the formal payroll system.
The gap also means that measuring pension-sector expansion by the number of accounts opened may give an incomplete picture of actual retirement savings coverage.
There are signs of increased activity among the relatively small pool of active PPP contributors.
Contributions under the scheme rose to N147.16 million in the first quarter, up from N103.30 million in the preceding quarter, representing a 42.46 percent increase. Cumulative PPP contributions since inception reached N1.66 billion by the end of March.
However, the value of quarterly contributions remains small relative to the 219,316 accounts registered under the scheme, underscoring the challenge of converting enrolment into sustained retirement savings.
The PPP was designed to extend Nigeria’s Contributory Pension Scheme to self-employed workers and people operating outside conventional employer-employee arrangements.
Unlike formal-sector workers whose pension contributions are deducted through payroll, participants in the personal pension scheme have to make contributions themselves.
That structure makes sustained participation more difficult and puts greater emphasis on income stability, financial awareness, convenience of payment and incentives to save.
The first-quarter data therefore show that the next phase of pension-sector growth may depend less on getting Nigerians to open accounts and more on persuading them to fund and maintain those accounts.
Personal pension plan faces conversion test
The scale of the unfunded accounts highlights the difference between pension inclusion on paper and actual retirement preparedness.
For every roughly 12 PPP accounts registered by March, only one had received a contribution.
Industry analysts contend that the disparity could limit the extent to which the scheme delivers its intended objective of building a broader pool of long-term domestic savings.
It also presents a challenge for pension fund administrators, who must maintain relationships with account holders after registration and encourage irregular or inactive savers to begin making contributions.
AccessARM Pensions recorded the largest share of new PPP registrations during the first quarter, accounting for 33.64 percent, while its cumulative share of all PPP registrations stood at 52.4 percent.
The concentration illustrates the competitive opportunity for PFAs as operators seek to convert the growing pool of registered informal-sector participants into active contributors.
Meanwhile, the weakness in PPP funding contrasts with continued growth in Nigeria’s wider pension registration base.
New RSA registrations under the Contributory Pension Scheme rose 24.7 percent to 143,248 in the first quarter, compared with 114,864 in the preceding quarter.
Total registered RSAs increased from about 11.04 million at the end of 2025 to 11.18 million by March 2026.
The composition of new entrants also points to a relatively young contributor base, with people below 40 accounting for 75.31 percent of new RSA registrations during the quarter.
However, the growth in registration numbers does not necessarily translate into equivalent growth in retirement savings.
The PPP figures provide the clearest illustration of the distinction, pointing out that the industry can bring more people into the formal pension architecture without generating contributions from the majority of those accounts.
The issue is becoming more significant as Nigeria’s pension industry grows into one of the country’s largest pools of domestic capital.
Total pension assets reached a record N31.32 trillion in May 2026, according to PenCom’s unaudited industry report, up from N30.94 trillion in April.
The May figure represented a monthly increase of about N384.98 billion and a 29.5 percent year-on-year rise from N24.18 trillion.
The expanding asset pool is strengthening the role of pension funds in Nigeria’s financial system, creating a larger source of long-term capital for government securities, corporate investments and, potentially, infrastructure.
But the persistent funding gap under the PPP shows that the growth of the overall pension pool is not being matched by equally broad participation among informal-sector workers.
PenCom weighs further reforms
The funding challenge comes as PenCom reviews the country’s pension framework and considers measures to increase contributions and broaden the economic role of pension assets.
The commission disclosed plans in July to review statutory pension contribution rates under the Pension Reform Act 2014.
The current framework requires employers to contribute a minimum of 10 percent of an employee’s monthly emoluments, while employees contribute 8 percent, producing a mandatory contribution rate of 18 percent.
PenCom has indicated that the rate could rise under the proposed reforms.
The commission is also developing a new investment vehicle that could direct part of Nigeria’s growing pension assets towards critical infrastructure projects.
For such reforms to deliver economic benefits, however, the industry will need to expand not only the value of pension assets but also the number of Nigerians consistently contributing to them.
From registration to retirement savings
The first-quarter figures leave Nigeria’s pension industry with a two-sided picture.
On one hand, more Nigerians are entering the pension system, new RSA registrations are rising, younger workers account for the majority of new entrants and PPP contributions increased sharply during the quarter.
On the other, 200,505 PPP accounts remained unfunded, meaning registration is running significantly ahead of actual savings activity.
The challenge is particularly important for informal-sector workers, whose incomes may be irregular and whose ability to make fixed monthly contributions can be limited.
PenCom and PFAs therefore face a more difficult task than simply expanding enrolment. They must develop mechanisms that make contributions easier, more regular and more attractive to workers outside the formal payroll system.
Until that happens, Nigeria’s growing pension registration numbers could continue to overstate the depth of actual retirement savings coverage.
The real measure of the next phase of pension-sector expansion will therefore be whether the industry can turn its 219,316 PPP registrations into active, consistently funded retirement accounts.
