PenCom Announces Changes in Retirement Benefits, Names 8 Payment Providers in Nigeria
- PenCom has granted Pension Funds Administrators full authority to process and approve retirement benefits
- The new rules eliminate the need for prior approval from PenCom when workers need to access retirement benefits
- Also, eight Payment Service Providers (PSPs) have been approved to facilitate seamless pension disbursements
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Legit.ng journalist Dave Ibemere has over a decade of business journalism experience with in-depth knowledge of the Nigerian economy, stocks, and general market trends.
The National Pension Commission (PenCom) has introduced reforms to the administration of retirement benefits under the Contributory Pension Scheme (CPS).
In a circular released, PenCom grants Pension Fund Administrators (PFAs) greater autonomy in processing payments.
Source: Getty Images
Additionally, PenCom has named eight approved Payment Service Providers (PSPs) to facilitate the seamless disbursement of pension benefits across Nigeria.
Under the new regulations, which take effect from June 1, 2025, PFAs will no longer require prior approval from PenCom before processing various benefit applications.
This change is expected to make payments seamless and enhance service delivery for retirees and contributors.
Key changes in retirement benefits administration
- PFAs will independently process and approve applications for retirement benefits, including programmed withdrawals, annuities, and voluntary contributions.
- Benefit applications must be processed within two working days after the completion of the required documentation.
- Pension Fund Custodians (PFCs) must credit beneficiaries' accounts within 24 hours of receiving payment instructions from PFAs.
- PenCom will still approve depleted RSA requests and death benefits in line with the Pension Reform Act (PRA) 2014.
PenCom approves new PSSPs
The National Pension Commission (PenCom) has also approved nine Payment Solution Service Providers (PSSPs), including Interswitch, Awabah, and Pencentral, to streamline pension contribution remittances in Nigeria.
As part of its transition to an online Pension Contribution Remittance System (PCRS), PenCom is phasing out manual remittance processes.
According to an update on its website, the new system will enable employers to upload pension schedules and make payments online.
PenCom assured that the service is free of charge for employers and is aimed at improving transparency, efficiency, and accountability in pension administration.
Approved payment providers
To make it easier for businesses to fulfill their pension obligations while ensuring employees’ contributions are accurately allocated, the commission has authorized nine PSSPs under the new system:
- Paypen by Netline Limited
- Pencentral by Chamsaccess Limited
- Pensphere (formerly Paythru) by Pethahiah Rehoboth Int’l Limited
- Penremit by Cyberspace Limited
- Pensol by Uniswitch Technology Limited
- Penco by Gemspay Solutions Limited
- Awabah by Awabah Remit Services Limited
- Epcoss by Nigeria Inter-bank Settlement Systems Plc
- Interswitch by Interswitch Group
PenCom lists new requirements for retirement savings accounts
Earlier, Legit.ng reported that PenCom had mandated the inclusion of the provision of Bank Verification Numbers (BVN) for retirement savings accounts.
The instruction was directed at saving accounts of workers of both the government and private companies.
There was also a new instruction on the documentation requirements for retirement savings account registration.
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Source: Legit.ng
Dave Ibemere (Senior Business Editor) Dave Ibemere is a senior business editor at Legit.ng. He is a financial journalist with over a decade of experience in print and online media. He also holds a Master's degree from the University of Lagos. He is a member of the African Academy for Open-Source Investigation (AAOSI), the Nigerian Institute of Public Relations and other media think tank groups. He previously worked with The Guardian, BusinessDay, and headed the business desk at Ripples Nigeria. Email: dave.ibemere@corp.legit.ng.
Kola Muhammed (Copyeditor) Kola Muhammed is an experienced editor and content strategist who has overseen content and public relations strategies for some of the biggest (media) brands in Sub-Saharan Africa. He has over 10 years of experience in writing and (copy)editing.
