Data from the National Pension Commission has shown that 312,771 Retirement Savings Account holders have moved about N1.41tn from one Pension Fund Administrator to another.
N1.41tn represents the value of assets that had been moved from one PFA to another in the last 16 quarters, the latest data from PenCom has shown.
Section 13 of the Pension Reform Act 2014 specifies that an employee can transfer his or her retirement savings account from one pension fund administrator to another, not more than once a year. PenCom announced November 9, 2020, at the official launch of the Retirement Savings Account Transfer System.
According to PenCom, to initiate an RSA transfer, the RSA holder is not required to go to their current PFA (Transferring PFA). Instead, the RSA holder should approach the PFA they intend to transfer to (receiving PFA) and provide their RSA PIN, surname, current telephone number, and email address. The receiving PFA will validate the biodata of the RSA holder requesting a transfer. Thereafter, the RSA holder’s fingerprint will be captured to authenticate their identity as the final step to conclude the transfer request. The receiving PFA prints two copies of a confirmation slip, which the RSA holder should sign as proof that they initiated the transfer; finally, the PFA retains a copy of the confirmation slip while a copy is given to the RSA holder.
The latest data from the regulator showed that the value of transferred assets has been on the increase in 2024.
In the first quarter, 22,927 RSA holders had moved about N120.87bn; in the following quarter, it increased to N128.87bn from 20,993 RSA holders. In the three months ending September 2024, the value of transferred assets between PFAs was N141.87bn. This was the third-highest amount that had been moved between PFAs since the start of the Retirement Savings Account Transfer System. These assets were also moved by the highest number of RSA holders, 23,226, this year.
Cumulatively, in the first three quarters of 2024, 67,146 RSA holders have transferred N391.60bn from one pension fund manager to another.
Since the inception of the transfer system, the highest value of assets, N158.60bn, had been moved in Q2 of 2023 by 34,359 RSA holders, followed by Q3 2022, when 30,973 RSA holders moved N143.09bn.
PenCom had said that the introduction of the RSA transfer is expected to result in improved service delivery across the pension industry as PFAs engage in healthy competition by providing enhanced service offerings to benefit RSA holders.
Meanwhile, the total pension fund assets under the Contributory Pension Scheme have risen to N21.92tn as of October 2024, with contributions from 10.53 million registered participants.
The Director-General of PenCom, Omolola Oloworaran, anticipates that the assets will surpass N22tn by the end of the year.
At the 2024 PenCom Media Conference, Oloworaran said, “As of October 2024, the CPS has recorded 10.53 million registered contributors and boasts pension fund assets of N21.92tn.
These numbers reflect our unwavering commitment to fund safety, prudent management, and sustainable growth.”
However, she noted the economic challenges impacting the pension fund, including high inflation, naira devaluation, and the lingering effects of unorthodox monetary policies, which have eroded the real value of pension funds and reduced contributors’ purchasing power.
To address these challenges, PenCom has undertaken a review of its investment regulations, focusing on diversifying investments into inflation-protected instruments, alternative assets, and foreign-currency-denominated investments.
