The National Pension Commission (PenCom) says the Micro Pension Plan (MPP) contributions as at May stood at N435.61 million from 97,591 participants registered.
Mr Dauda Ahmed, Head, Micro Pension Department, PenCom, revealed this on the sidelines of the maiden Micro Pension Open Day, organised by the Pension Operators Association of Nigeria (PenOp) in Lagos.
The event had its theme as “Micro Pension – Challenges, Prospects for Growth and Deepening Financial Inclusion in Nigeria”.
Ahmed said that the total contigent withdrawal by 150 Micro Pension Contributors (MPC) as at the month under review stood at N30.24 million.
According to him, the commission recorded N6.51 million as the amount converted by 581 Retirement Savings Accounts (RSAs) holders, under the informal sector to RSA’s under the formal sector.
The PenCom scribe explained that the MPP is an opportunity for workers, who are mainly under the informal sector to save for their retirement.
Ahmed said that the MPP, as revised this year, is expected to extend pension coverage to over 2.2 million informal sector workers by 2024.
He said, as part of incentives to embracing micro pension, PenCom was working toward adopting a minimum health insurance for eligible MPP participants.
Ahmed stated that the commission was also engaging with labour unions, trade associations and several groups on embracing the plan.
Ahmed listed the challenges to the implementation of the plan to include; lack of awareness, mistrust about the pension system, absence of appropriate incentives and lack of financial literacy.
According to him, the Pension Fund Administrators (PFAs) based MPP on short-term perspectives, especially in term of financial benefits and the perceived associated cost.
Ahmed blamed the PFAs for poor service delivery, inadequate awareness campaign for the product and slow adoption of shared services arrangements.
The identified other factors impeding the implementation of the MPP as weak economic indices, inflation and increased poverty level.
Earlier, Mr Oguche Agudah, Chief Executive Officer (CEO), PenOp charged the informal sector workers to visualise how their needs would be met in next 20 to 30 years without a pension plan.
Agudah noted the PFAs were concerned about improving the mirco pension penetration in Nigeria, saying, “the country has the largest informal sectors who are not covered by any form of formal pension”.
“We, in the pension industry, work to get as many informal sector workers as possible on a pension scheme.
“Those within a structured organisation or who employ less than three persons and youths growing the informal gig economy; starting businesses on their laptop without any office, yet earning decently.
“We are passionate about mirco pension, as today’s event revolves around the audacious industrial goal to engage as many informal sector workers as possible, to sign up for the scheme for the benefit of everyone,” he said.