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Frequently Asked Questions

Frequently Asked Questions

ARE PENSION CONTRIBUTIONS PAID TO THE PFA?

Pension contributions are paid directly to the PFC to be held on the order of the PFA.


WILL INFLATION AND DEVALUATION OF THE NAIRA NOT ERODE THE VALUE OF THE PENSION CONTRIBUTIONS?

It is the duty of the PFAs to administer the contributions and invest in such a way that will ensure safe and reasonable returns on investment. The reserve fund created […]


WHO IS A CUSTODIAN?

A Pension Fund Custodian (PFC) is a company licensed by the National Pension Commission to keep pension money and assets in the RSA on trust for the employee on behalf […]


WHAT HAPPENS TO THE RETIREMENT BENEFITS OF ANEMPLOYEE WHO IS ALREADY UNDER A PENSION SCHEMEEXISTING BEFORE THE COMMENCEMENT OF THE NEW PENSIONSCHEME?

Employee’s right to accrued retirement benefits for the previous years he/she has been in employment is guaranteed by the Pension Reform Act 2004. In the case of the public service […]


WHAT DOES ‘FULLY FUNDED’ PENSION SCHEME MEAN?

A fully funded pension scheme exists where pension funds and assets match pension liabilities at any given time.


HOW IS COMPULSORY OR VOLUNTARY RETIREMENT ESPECIALLY IN THE ARMED FORCES TO BE HANDLED UNDER THE NEW SCHEME, IF THIS HAPPENS BEFORE THE AGE OF 50 YEARS?

Under the Pension Reform Act 2004 a person can voluntarily retire or be compulsorily retired before the age of 50 years on the ground of medical advice, permanent disability or […]


WHAT IS THE DIFFERENCE BETWEEN A PFA AND A PFC?

The PFA manages and invests the pension funds while the PFC keeps the pension funds and assets in safe custody and carries out transactions on behalf of the PFA.


HOW WILL THE FEDERAL GOVERNMENT FUND THEREDEMPTION BONDS?

The Federal Government has established a Retirement Benefits Bond Redemption Fund Account in the Central Bank of Nigeria. The Federal Government is already making a monthly payment into the Fund […]


WHAT IS A RETIREMENT SAVINGS ACCOUNT (RSA)?

Every employee or contributor under the new pension scheme is expected to open RSA in his/her name with a PFA of his/her choice into which all his/her contributions and returns […]


WHAT IS THE MINIMUM OF PENSION GUARANTEED UNDER THE NEW SCHEME?

The minimum pension guarantee shall be determined from time to time by the National Pension Commission.


WHAT ARE THE MINIMUM FINANCIAL REQUIREMENTS FOR A PFA OR A PFC LICENCE?

An applicant PFA must have a minimum paid up share capital of N150,000,000 while an applicant PFC must have a minimum paid up capital of N2,000,000,000 and shall be a […]


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