Awabah faces critical test as PenCom activates personal pension plan agent model

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Chuks Udo Okonta

Following the National Pension Commission’s (PenCom) strategic pivot from the Micro Pension Plan (MPP) to the more robust Personal Pension Plan (PPP), the licensing of Awabah as a pioneer Pension Agent marks a turning point in Nigeria’s quest for financial inclusion.

However, industry observers note that the path to capturing the informal sector—which holds over 75 million workers—is fraught with structural hurdles.

While the rebranding to “Personal Pension” aims to shed the “micro” stigma and attract a broader range of freelancers and professionals, the numbers remain sobering. As of the end of Q3 2025, PenCom data reveals that total RSA registrations under the PPP stood at 206,917.

The primary task ahead for Awabah is the “Activation War.” Currently, a staggering 92.4 per cent of these accounts remain unfunded. Out of the over 200,000 registered Personal Pension Plan contributors, only 15,677 were active during the last reporting quarter.

To satisfy PenCom’s latest mandate, Awabah must move beyond mere registration (the “numbers game”) and ensure consistent monthly remittances from artisans, traders, and the burgeoning “gig economy” workforce.

Inspenonline reliably gathered that PenCom’s new leadership, led by Director-General Ms. Omolola Oloworaran, is banking on Pension Agents to solve the “last mile” distribution crisis. With total Retirement Savings Accounts (RSAs) across the entire industry reaching 10.92 million by late 2025, the focus has shifted from the formal sector to the 75 million Nigerians currently without social protection.

Infrastructure Reliability: Deploying a USSD and mobile ecosystem that remains uptime-efficient in rural clusters.

Trust Deficit: Bridging the gap between the informal worker and the 18 licensed Pension Fund Administrators (PFAs).

AUM Growth: Helping the industry push past the ₦27.4 trillion asset mark by mobilizing micro-contributions that have historically been considered “too small” for traditional PFAs to pursue.

A unique feature of the PPP is the 60/40 split, allowing contributors to withdraw 40 per cent of their savings for emergencies after a specified period.

“The task for Awabah is to educate the informal sector that a pension is not a ‘savings account’ for daily withdrawals, but a long-term safety net,” says an industry analyst. “If the withdrawal rate matches the contribution rate, the fund fails to grow, and the goal of old-age poverty alleviation is defeated.”

The agent model comes at a time when the industry is still adjusting to the ₦20 billion minimum capital requirement for PFAs, set for full compliance by December 31, 2026. Awabah’s success is now inextricably linked to the survival of the PFAs it services. By driving volume, Awabah provides the Assets Under Management (AUM) growth necessary for these firms to justify their increased capital base.