The National Pension Commission (PenCom) on Friday said it has recorded some modest success in its efforts to extend pension coverage to the informal sector.
The Director-General, PenCom, Mrs Aisha Dahir-Umar said this at the maiden Micro Pension Open Day, organised by the Pension Operators Association of Nigeria (PenOp) in Lagos.
The theme of the event is: “Challenges, Prospects for Growth and Deepening Financial Inclusion in Nigeria”.
Dahir-Umar, represented by Mr Ehimeme Ohioma, Head Surveillance Department, explained that the Micro Pension Plan (MPP) was designed to encourage a savings culture among low-income earners and self-employed individuals in the country.
She said as at April, the total number of registered micro pension participants stood at 95,045 with a total value of the MPP fund of N435.61m.
“Recall that the MPP was formally launched in March 2019 by the former President Muhammadu Buhari administration, as part of the commission’s efforts to expand pension coverage to workers in the informal sector.
“This initiative will promote economic growth by providing a stable source of income for retirees and reduce old-age dependency, thereby causing a reduction in poverty rate.
“It is, however, clear that more needs to be done to achieve the desired outcome of extending coverage to workers in the informal sector with an estimated 50 to 75 million workers,” she said.
According to her, the MPP implementation challenges currently include low awareness level, limited contribution remittance channels and lack of adequate incentives to encourage participation.
Dahir-Umar said the plan was also challenged by absence of innovation to enhance efficiency around registration, pension contribution remittances and benefit payments.
She lauded PenOp for organising an event that brought together, key players in the Micro Pension Plan initiative, such as Pension Fund Administrators (PFAs) Pension Fund Custodians (PFCs) services providers, industry experts and the media.
The director-general noted that the platform would enable stakeholders to interact on developments, challenges and strategies to ensure successful implementation of the MPP.
Dahiru-Umar urged stakeholders in the industry to leverage on the platform to discuss and explore ways to overcome the hurdles associated with the implementation of the MPP.
According to her, the theme of the open day aligns with the commission’s resolve to expand pension coverage to all workers, particularly those in the informal sector through the MPP.
In his welcome address, the Chief Executive Officer (CEO) PenOp, Mr Oguche Agudah, said the PFA’s would work toward harnessing the huge potential of the micro pension market.
Agudah lauded PenCom for being focused and committed to ensuring that the MPP thrived.
He noted that the pension industry remained everyone’s products and as such, all needed to work together to improve it.
“We will work toward innovation, new product and advance technology to capture the underserved demographic as clamoured.
“There is prospect in MPP because the market is huge, so we invite all our stakeholders to engage more with us to double the present record of the plan,” he said.