PenCom Strengthens Pension Access: New Circular Mandates More PFA Branches, Service Centres, and Virtual Operations

In a decisive move to enhance pension accessibility across Nigeria, the National Pension Commission (PenCom) has issued a revised Circular on the operations of Branch Offices and Service Centres by Licensed Pension Fund Administrators (PFAs). This strategic policy shift comes in response to the growing demand for pension services and the need for greater efficiency in service delivery to Retirement Savings Account (RSA) holders.

A Necessary Overhaul:
For years, RSA holders across the country have faced challenges in accessing pension services due to the limited presence of PFAs in many states. This has led to inefficiencies, delays in processing benefits, and a general lack of customer support. Recognizing these gaps, PenCom has now mandated stricter requirements for PFAs to expand their physical and digital presence, ensuring that pension services reach every eligible contributor with ease.

Key Provisions of the New Circular:

• Mandatory Expansion: PFAs must establish Branch Offices in states where they manage at least 10,000 funded RSAs and at least one additional Service Centre where they have up to 2,000 RSAs.
• Standardized Operations: Each Branch Office must provide essential pension administration, benefits processing, customer support, and business development services, staffed by at least six qualified professionals.
• Infrastructure Requirements: Offices must be well-equipped with ICT infrastructure, alternative power sources, fire safety measures, and accessibility features such as elevators where necessary.
• Virtual Branches: PFAs must leverage technology to create online platforms for account management, contribution tracking, retirement planning tools, and real-time customer support, enhancing service delivery beyond physical locations.
• Strict Compliance Measures: PFAs failing to meet these requirements will face penalties starting at ₦10 million, with possible increments based on the severity of infractions.

Industry Reactions: A Call for Stricter Enforcement

While the move has been widely applauded, industry analysts and stakeholders argue that the penalties set by PenCom may not be stringent enough to enforce full compliance. Observers have suggested that the fines should be significantly increased—up to ₦100 million per year of default—to ensure PFAs prioritize compliance over cost-saving measures. Additionally, sector experts urge PenCom to ensure that the August 1, 2025, deadline remains firm, preventing any form of policy relaxation.

The Future of Pension Accessibility in Nigeria

With this policy, the Nigerian pension industry is set for a transformation that will improve transparency, accessibility, and efficiency in pension administration. However, the success of this initiative depends on strict enforcement by PenCom and full cooperation from PFAs. If well implemented, RSA holders nationwide will benefit from faster service delivery, increased financial security, and improved retirement planning—paving the way for a more robust pension system in Nigeria.

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