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Chuks Udo Okonta
An expert in pension matters, Dr. Goodman Ade, has said Pension Fund Administrators (PFAs) are struggling with marketing of Micro Pension Plan (MPP) because they failed to understand that ‘Pension is Sold not Bought’ in a country like Nigeria.
He told Inspenonline that pension is part of insurance, hence faces similar challenges, adding that as a measure to sell the product, PFAs should lace it with incentives especially micro credit that would enable contributors grow their business and have funds to contribute.
“The catch phrase is “Insurance is Sold not Bought” like banking and other financial services.
Pension is an aspect of Insurance just like Taxation is to Accounting. Anybody trying to to deny this fact or argue about is is either ignorant or wallows in self deceit. Therefore “Pension is Sold not Bought” too,” he submitted.
According him, the National Assembly recognised this in 2004 and 2014 and made pension contribution compulsory for both employers and employees and went further to introduce many incentives including no tax to encourage people to do voluntary contribution too.
“Now, if you sample the opinions of the target customers, particularly artisans and traders, all they need is micro credit to boost their businesses. In order to get them to save for pension, they have demanded for incentives too. And they have made it very clear to PFAs, their regulator inclusive that they want micro credit and in return do micro pension.
He maintained that anything short of that will yield no good results, stressing that PFAs would waste their money to set up the platforms and Infrastructure for micro pension but nobody will patronise them if they failed to do the needful.
This medium had exclusively reported that PFAs seem to be struggling to on-boarding contributors into micro pension plan as three firms registered only six subscribers in the third quarter of 2022.
The National Pension Commission (PenCom) in its micro pension registration schedule for the month of September 2022, which showed the Retirement Savings Accounts (RSAs) registered in third quarter, revealed that Crusader Sterling Pensions Limited, registered four contributors; Guaranty Trust Company, one contributor and Radix Pension Managers Limited, one contributor.
Sigma Pensions Limited also registered 16 contributors in the quarter, while Stanbic iBTC Pension Managers Limited, registered the highest which was 1137 contributors.
PenCom noted that the total number of registered contributors in the quarter stood at 4,193.
The pension industry regulator submitted that the total number of registered contributors from inception to September 2022 was 84,612.
It said ARM Pension Managers (PFA) Limited has the highest contributors which was 21,375 and Sigma Pensions the lowest 16 contributors.