Employers will not be able to remit deducted pension funds into employees’ Retirement Saving Accounts, RSAs, from April 1, 2025, if they fail to key into a new standardized payment schedules system that have been approved by the National Pension Commission, PenCom, and Pension Fund Operators Association of Nigeria, PenOp
Aimed at making pension fund remittance seamless and easier effective April 1, 2025, four Payment Solution Service Providers, PSSP, have been selected by PenCom and PenOp.
The four PSSPs that have been selected and engaged to facilitate pension remittances, ensuring that all platforms meet industry specifications includes PayPen by Netline Ltd, Paythru by Pethahiah by Rehoboth International Ltd., Pension Central by Chams, and Cyberpay by Cyberspace Ltd.
The Chief Executive Officer, CEO, of PenOp, Oguche Agudah at a programme in Lagos, organised by the National Pension Commission, PenCom, for journalists, informed that the process would not attract any extra cost for employers.
According to him, “Standardized templates and automated validation processes will lessen the administrative workload for Pension Fund Administrators (PFAs), Custodians and the employers. This can lead to cost savings and allow staff to focus on other critical areas of pension management.”
He explained that the development and enforcement of standardized templates for remittance schedules would ensure uniformity in the information provided.
According to him, it would “Introduce validation checks on electronic payment platforms to verify the accuracy of information before submission. This includes validating PINs to reduce the number of invalid entries that lead to upload exceptions
“Leverage technology solutions such as automated systems for pension fund management that can reduce human errors in data entry and improve overall efficiency in processing contributions. There is a growing recognition among stakeholders about the importance of timely remittances and accurate documentation, leading to better compliance practices among some employers.”
He noted that “By requiring remittance schedules to accompany payments, the accuracy of contributions credited to Retirement Savings Accounts, RSAs, is significantly improved. This reduces the likelihood of unmatched contributions, streamlining the reconciliation process.”
Agudah said “With a standardized process and validation checks in place, contributions can be credited to RSAs promptly. This ensures that RSA holders receive their funds as due, enhancing their financial security upon retirement.
“It will increase transparency. A more transparent remittance process allows for better tracking and reporting, which can enhance trust among stakeholders, including employees, employers, and regulatory body’s effectiveness.
“Standardized templates and automated validation processes will lessen the administrative workload for Pension Fund Administrators (PFAs). Custodians and the employers. This can lead to cost savings and allow staff to focus on other critical areas of pension management. For the employer, they are able to focus on their core functions.
“A well-functioning pension system contributes to economic stability by mobilizing long-term savings for investment in various sectors. Timely pension remittances enhance this effect by ensuring that funds are available for investment purposes.”
Earlier, Head, Benefits and Insurance Department, PenCom, Obioral Ibezialo, while delivering a paper on The New Pension Contribution and Collection System said the current situation of Pension remittance was the issue of electronic remittances without schedules.
According to him, some employers send schedules without accompanying schedule for their staff, leading to unmatched pension remittances which raises concerns about the potential loss of value for Retirement Savings Account (RSA) holders.
He said for the new solution, four PSSP have been selected and engaged to facilitate pension remittances, ensuring that all platforms meet industry specifications. This he said, includes; PayPen by Netline Ltd, Paythru by Pethahiah by Rehoboth International Ltd, Pension Central by Chams and Cyberpay by CyberSpace Ltd.
He added that the new solution would enhance accuracy and efficiency, “By requiring remittances schedules to accompany payments, the accuracy of contributions credited to Retirement Savings Accounts (RSAs) is significantly improved. This reduces the likelihood of unmatched contributions, streamlining the reconciliation process.” (Vanguard)
