The National Pension Commission has sped up the payment of retirement benefits as indicated in a new policy directive to licensed pension fund administrators.
According to the circular on Approval of Benefits to Holders of Retirement Savings Accounts by Licensed Pension Fund Operators, the changes were part of ongoing efforts to enhance operational efficiency and service delivery.
Before now, PFAs were required to review, process, and forward all benefit payment applications to the Commission for approval before the appointed PFCs could credit beneficiaries’ accounts.
In a statement accompanying the circular, the commission said that effective June 1, 2025, PFAs will no longer be required to seek approval or obtain a “No Objection” from PenCom before processing and disbursing benefits, including Programmed Withdrawal, Retiree Life Annuity, and Temporary Loss of Employment benefits, among others.
However, PFAs must continue to submit requests for approval to the Commission regarding depleted RSAs and death benefit applications, in accordance with Section 8 (2) of the Pension Reform Act 2014.
“Furthermore, PFAs are mandated to process and approve eligible benefit applications within two working days of receiving all required documentation, while Pension Fund Custodians must ensure payment of the approved benefits within 24 hours of receiving instructions from the PFAs. PenCom will continue to monitor the implementation of this policy through its regulatory technology platforms and other supervisory mechanisms to ensure full compliance,” PenCom stated.
This new policy is designed to streamline the benefit payment process, significantly reducing delays and improving access to entitlements for retirees and other RSA holders.
PenCom further stated it will continue to conduct reviews of transactions processed by PFAs to ensure compliance with applicable regulations.
“The commission will apply appropriate regulatory measures where necessary to uphold transparency, accountability, and the integrity of the pension system.
“RSA holders are reminded that timely submission of the necessary documentation to their PFAs is crucial for seamless access to benefits. Prospective retirees are advised to submit all relevant documents at least six months before retirement. All benefit applications must be supported by the documentation prescribed in the Commission’s Regulations and Guidelines,” the commission concluded.
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