Business
THE National Pension Commission (PenCom) has urged artisans, traders and other self-employed people to enroll in the Micro Pension Plan of the commission to guarantee a functional retirement plan they can hold-on to.
The Head, Corporate Communications of PenCom, Abdulqadir Dahiru, made the call in Enugu on Thursday.
He stressed the importance of the Micro Pension Plan to Nigerians in the informal sector and those working in organizations with less than three employees.
Dahiru noted that about 90 per cent of workers in Nigeria were in the informal sector, adding that this category of workers had no pension protection for old age and with the increase in people living long, “there is a risk of old age poverty”.
According to him, the Micro Pension Plan platform provides workers in the sector the opportunity to easily register and contribute in a flexible manner and in a safe and secure environment for their pension at retirement.
“The Micro Pension Plan is a flexible plan, where the artisans, traders and even a woman that sells fried beans cake (akara) can register with and agree a periodic amount she/he would be contributing according to her/his earnings.
“The contributors, within this flexible Micro Pension Plan for all Nigerians in the informal sector, can even draw out 40 per cent of what they have saved for emergency demand.
He said the remaining 60 per cent would remain and await for the retirement plan proper.
“So, it is a means of savings also for those in the informal sector and where they could fall back to and get financial assistance to keep their daily engagements going,” he said.
He noted that PenCom was desirous to ensure Nigerians in the informal sector enrolled and registered in the plan, adding that it had started sensitisation of the plan to communities, market places, public gatherings, associations and trade fair grounds across the country.
Dahiru also urged Nigerians to embrace PenCom acquisition of residential mortgages (residential houses) scheme for Retirement Savings Account (RSA) holders.
He said the Central Bank of Nigeria (CBN) had approved 34 mortgage banks to work with the PenCom and Pension Fund Operators in providing mortgage financing to Contributors into the Contributory Pension Scheme (CPS) with their RSA balance.
The PenCom spokesman said that the commission was determined to implement the scheme for the contributors to ensure that RSA holders have houses of their own at retirement.
Dahiru noted that for contributors under the Contributory Pension Scheme (CPS) to be eligible to use their RSA balance for acquisition of residential mortgages, they must have contributed for five years (60 months) cumulative of employer and employee’s mandatory contributions.
“The same thing applies to the contributors under the Micro Pension Plan; even married couples, who individually met the eligibility criteria, were also eligible,” he said.
Explaining the limit for equity contribution that qualified a contributor, he said that the maximum allowed was at 25 per cent of the RSA balance.
He added that where 25 per cent of RSA balance was more than equity contribution, the RSA holder could only access the amount equivalent to equity contribution required.
“Where 25 per cent was not sufficient for equity contribution, RSA holders may utilise Voluntary Contribution (VC) in line with the Voluntary Contribution guidelines,” he said.
He expressed the hope that the mortgage financing incentive would help to grow the number of contributors into the CPS scheme. (NAN)
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Tags: Abdulqadir Dahiru Micro Pension Plan to Nigerians National Pension Commission
