75 MILLION NIGERIANS MAY RETIRE WITHOUT PENSION BENEFITS — PENCOM
Read Time:2 Minute, 55 Second
By: Fasasi Hammad
Over 75 million Nigerians employed in the informal sector are at risk of retiring without any pension or retirement savings, the Director-General of the National Pension Commission (PenCom), Omolola Oloworaran, has revealed.
Oloworaran made the statement on Monday in Abuja during the presentation of a licensed accredited pension agent certificate to Awabah, the first company accredited under PenCom’s new pension agent framework.
She noted that while Nigeria’s pension reforms have strengthened retirement security for formal sector workers, the vast majority of informal workers remain outside the pension system.
Citing data from the National Bureau of Statistics, she said that more than 90 per cent of Nigeria’s workforce operates in the informal economy, yet pension coverage for this group stands at just 0.25 per cent.
“This means millions of market traders, artisans, farmers, transport operators, technicians, small business owners, and young entrepreneurs retire without any savings, pensions, or social protection,” Oloworaran explained. “After decades of hard work, old age should bring peace, not fear. This gap is not only a social challenge—it is a national vulnerability. An economy cannot be resilient if households lack protection, and a country cannot be strong when millions slide into poverty.”
READ MORE;
She recalled that the 2004 Pension Reform Act transformed Nigeria’s pension system by replacing unfunded promises with a contributory structure. Since then, pension assets have grown to over ₦27 trillion, with more than 10 million retirement savings accounts.
“Reform has worked, but it has mainly benefited formal workers. Nigeria is largely an informal economy, and this leaves a huge coverage gap that must be addressed,” she said.
Oloworaran stressed that expanding pension access to the informal sector is now the next critical phase of pension reform, warning that widespread old-age poverty poses both social and economic risks.
To bridge the gap, PenCom introduced regulations for accredited pension agents and rebranded the micro-pension scheme as the personal pension plan to encourage wider participation. These agents are expected to drive inclusion by operating directly within communities and workplaces, leveraging technology to allow informal workers to make small, flexible contributions and access their accounts in real time.
“Digital platforms, micro-daily or weekly contributions, seamless benefit payments, and low-cost servicing at scale are essential if we are serious about reaching over 75 million Nigerians,” Oloworaran said. She added that pension contributions are tax-deductible, with fintechs, payment service banks, and telecom companies playing a critical role in expanding access.
Describing Awabah’s accreditation as a milestone, she said the initiative marks the beginning of a new phase in pension distribution for informal sector workers and will create employment opportunities for thousands of agents nationwide.
Tunji Andrews, CEO of Awabah, noted that the company was founded to address the financial insecurity of informal workers. “We saw skilled artisans, tireless traders, and vibrant creators who drive our economy every day, but their protection was nearly non-existent,” he said.
Awabah’s pension products, bundled with insurance coverage under the ValuBah plan, allow informal workers to access retirement savings, health insurance, accident cover, and life insurance for as little as ₦3,000 per month.
Since 2004, pension reform has mainly benefited formal sector workers, leaving the informal workforce largely unprotected. PenCom’s personal pension plan and accredited pension agents aim to extend retirement savings access to this critical segment of Nigeria’s workforce.
Happy
0 %
Sad
0 %
Excited
0 %
Sleepy
0 %
Angry
0 %
Surprise
0 %
0
0