Six Years On, Personal Pension Plan Struggles To Take Off
By OBIOMA TORI
SIX years after its launch, Nigeria’s Personal Pension Plan (PPP) — the micro-pension scheme created to extend retirement security to over 70 million informal-sector workers — remains far from delivering its promise. Despite its national ambition, the scheme has attracted only about 200,000 contributors, with total assets still below ₦1 billion. Spread across 18 PFAs, each administrator has enrolled an average of just 1,830 contributors, a figure too small to sustain operational and outreach costs.
Designed under the Buhari administration to deepen financial inclusion, the PPP has yet to overcome persistent barriers: low awareness, deep mistrust of pension systems, cumbersome enrolment processes, and a lingering perception that pensions belong only to salaried workers. PenCom acknowledges these challenges but insists the redesigned PPP — with simpler onboarding, flexible contribution structures and stronger incentives — will accelerate growth.
A key reform is the expanded contingent withdrawal window, allowing contributors to access up to 50% of their savings after three months of consistent contributions. PenCom hopes this liquidity will appeal to informal workers with unpredictable incomes. The commission is also exploring health-insurance incentives and limited government-backed subsidies, though fiscal constraints make such support uncertain.
Another innovation is the introduction of foreign-currency pension accounts, enabling contributors earning in dollars, pounds, or euros to save and withdraw in those currencies. While this may attract diaspora workers and freelancers, its impact on broader inclusion remains unclear.
Industry leaders maintain that the scheme’s success hinges on aggressive public education. PFAs have historically overlooked the informal sector, but a few — such as Parthian Pensions — are now investing in digital platforms and grassroots outreach. For many Nigerians, however, the PPP remains unknown. “What is it about? How does it work?” asked Ibrahim Lawal, an upholstery maker who had never heard of micro-pensions. Others, like publisher Anite Okoro, say the idea is sound but visibility is nonexistent.
Experts warn that pension inclusion cannot advance without sustained engagement across markets, unions, cooperatives, gig-work platforms and community structures. The informal sector remains a vast source of long-term capital and a critical gap in Nigeria’s pension landscape.
At six years old, the PPP is still struggling to find its footing. Its future depends on whether regulators and PFAs can move beyond policy statements to genuine grassroots mobilisation — the only path to transforming a promising idea into meaningful retirement security for millions.
