The National Pension Commission (PenCom) has raised concerns over the slow growth of active savings under Nigeria’s Personal Pension Plan (PPP), warning that its target of having 30 percent of registered accounts funded by the fourth quarter of 2026 is unlikely to be achieved.
The warning follows the latest Nigerian Pension Industry Quarterly Report, which revealed a wide gap between pension account registration and actual contributions. Out of 219,316 PPP accounts registered so far, only 18,811 have received contributions.
This means just 8.5 percent of the accounts are currently funded, leaving more than 91 percent inactive.
PenCom said the development shows that the pension industry has placed too much emphasis on opening accounts without doing enough to encourage regular savings. According to the commission, simply registering workers does not amount to meaningful pension inclusion if those accounts do not receive contributions.
The commission warned that unless pension operators change their approach and improve their products and distribution channels, the 30 percent funded-account target for the end of 2026 will remain out of reach.
The funding problem is particularly important because the PPP is designed to bring workers in the informal sector and people without regular employer-sponsored pension arrangements into the formal retirement savings system.
During the quarter under review, PPP contributions stood at N147.16 million, while total contributions since the scheme began reached N1.66 billion.
PenCom said it plans to change its approach by introducing funding-conversion targets for Pension Fund Operators. It also plans to expand the use of accredited pension agents and strengthen partnerships with cooperatives, fintech companies, telecommunications firms, trade unions and professional associations.
The objective is to move more Nigerians beyond registration and into consistent pension contributions.
Meanwhile, the wider Retirement Savings Account (RSA) market continued to record growth. Total RSA registrations increased from 11.04 million at the end of 2025 to 11.18 million by the end of the first quarter of 2026.
A total of 143,248 new RSA accounts were opened during the quarter, higher than the 114,864 recorded in the previous quarter. PenCom attributed the increase partly to digital onboarding and greater public awareness.
Young Nigerians are also becoming an increasingly important part of the pension system. About 75.31 percent of new RSA registrations during the quarter belonged to people below the age of 40.
PenCom described this youthful contributor base as a major long-term opportunity for the industry, particularly because younger workers have decades to build retirement savings.
However, the commission noted that active pension contributors still account for only about 12.1 percent of Nigeria’s estimated 92 million-person labour force. This highlights the enormous opportunity to expand pension coverage, especially among informal workers.
The pension industry is also facing a wider policy debate over proposed changes to the Pension Reform Act 2014. Under the current system, employers contribute at least 10 percent of an employee’s monthly emoluments, while employees contribute 8 percent.
Proposals to increase these contributions have, however, attracted opposition from the Organised Private Sector of Nigeria, which argues that higher pension obligations could increase business costs.
For PenCom, the immediate priority remains clear: turning millions of registered pension accounts into active savings accounts and ensuring that pension inclusion is measured by real contributions rather than registration numbers alone.
