The Pension Reform
Act (PRA) 2014 expanded coverage of the CPS to the self-employed and persons
working in organizations with less than 3 employees. As this category of
workers constitute the larger percentage of the working population in the
country, there is no doubt that to achieve the Pension Industry’s strategic
objective of covering 30% of the working population in Nigeria under the CPS by
the end of 2024, all efforts should be on deck to extend coverage to this
important segment of the Nigerian economy. In addition, due to their widely
dispersed nature and generally low and irregular incomes, there is need to
provide a pension plan that would meet their special characteristics. In this
regard, the Micro Pension Plan initiative has been conceived within the context
of an industry wide strategy to bring this class of workers on board.
In implementing this
initiative, the informal sector has been segmented into three broad categories.
The low income earners, the high income earners and the SMEs. Each of these
categories is going to be targeted with appropriate pension products and
sensitization programmes that meet their peculiarities.
However, it is
evident that a robust technological platform that would support the provision
of customer services is necessary to effectively and efficiently register,
collect contributions, provide Retirement Savings Account support, pay benefits
and provide financial advisory services to this class of workers. Coincidently,
special mobile phone applications had been successfully implemented in some
jurisdictions for financial transactions including provision of pension
services to the self-employed and informal sector workers. The success stories
of these applications drives the confidence that similar platform can be
designed and implemented in Nigeria. Consequently, the Commission had already
commenced the sensitization of service providers and relevant regulators as
well as the targeted workers in the informal sector with a view of creating the
enabling environment and buy-in.
In addition, a Department has been established in the Commission to drive the implementation of
the Micro Pension Plan.