The National Pension Commission (PenCom) has escalated its regulatory oversight, issuing a firm warning to all licensed Pension Fund Administrators (PFAs) against the inducement of Retirement Savings Account (RSA) holders.
The move underscores the Commission’s commitment to transparency, fairness, and accountability in Nigeria’s contributory pension industry.
The directive, issued through a circular referenced PenCom/INSP/CIR/Surv/2025/1379 and signed by the Director of the Surveillance Department, A.M. Saleem, explicitly reiterates PenCom’s zero-tolerance stance against any form of inducement to RSA holders.
This includes the offering of cash, gifts, or any incentive—financial or non-financial—aimed at influencing the decision of RSA holders regarding the transfer or retention of their accounts.
“The Commission hereby emphasises its zero tolerance for any form of inducement.
Accordingly, any PFA found offering, granting, or facilitating inducements to influence an RSA holder’s decision shall be immediately barred from receiving RSA transfers,” PenCom stated in the circular.
The regulatory body further warned that violators would face additional sanctions in line with the Framework for the Regime of Sanctions, including penalties against both the PFA and its officers.
This recent directive builds upon PenCom’s ongoing efforts to strengthen confidence in Nigeria’s pension system.
Last month, the Commission issued similar guidance aimed at financial institutions and employers, cautioning them against interfering in the choice of Pension Fund Administrators or influencing the transfer of employees’ RSAs.
The Commission cited observations of illegal and unethical practices, where employees were being coerced or unduly influenced to open or transfer accounts with PFAs affiliated with their employers or connected through Pension Fund Custodians.
PenCom’s intensified oversight reflects a broader commitment to safeguard contributors’ funds and reinforce trust in the pension sector.
By eliminating inducements, the Commission seeks to guarantee that RSA holders make decisions based solely on informed, voluntary choices rather than external pressure or incentives.
This regulatory stance is also aimed at promoting healthy competition among PFAs, encouraging them to focus on delivering superior service and performance rather than relying on manipulative tactics to attract clients.
Experts in the pension industry have lauded PenCom’s move as a necessary step in strengthening governance.
Dr. Fatima Oladipo, a pension policy analyst, remarked, “Inducements undermine the credibility of the pension system and can erode public trust.
PenCom’s clear directive sends a strong message that the rights of RSA holders are non-negotiable and that PFAs must operate with utmost integrity.”
PenCom has also emphasized its proactive monitoring mechanisms to ensure compliance.
The Surveillance Department is tasked with continuous oversight of PFAs’ activities, investigating any reports of inducement or unethical practices.
PFAs found violating these directives risk severe penalties, including suspension from receiving RSA transfers, regulatory sanctions, and possible revocation of licenses in extreme cases.
Additionally, the Commission encourages RSA holders to report any instances of inducement or coercion to PenCom through its official channels, ensuring that contributors remain empowered to protect their retirement savings.
The latest directive is expected to foster a more transparent and accountable pension ecosystem in Nigeria.
By curbing inducements, the Commission aims to create a level playing field where PFAs compete based on service quality, investment performance, and adherence to regulatory standards.
This, in turn, is likely to enhance confidence among contributors and encourage greater participation in the country’s contributory pension scheme.
As Nigeria’s pension industry continues to expand, regulatory vigilance by PenCom remains critical to ensuring the long-term sustainability of the system.
The Commission’s actions reinforce its role as a guardian of retirement savings, promoting both investor protection and the integrity of financial markets.
PenCom’s stern warning to PFAs against inducing RSA holders represents a significant milestone in the regulation of Nigeria’s pension sector.
By enforcing a zero-tolerance approach, the Commission aims to protect contributors, uphold industry integrity, and strengthen public trust in the nation’s contributory pension scheme.
The message is clear: ethical compliance and transparency are non-negotiable, and any attempt to manipulate RSA holders will face immediate and decisive action.
