The National Pension Commission (PenCom) has raised concerns that Nigeria may miss its target of having 30 percent of Personal Pension Plan (PPP) accounts funded by the fourth quarter of 2026, as the vast majority of registered accounts remain inactive.
The latest Nigerian Pension Industry Quarterly Report shows that only 18,811 of the 219,316 PPP accounts registered under the scheme have received contributions.
That represents a funding rate of just 8.5 per cent, meaning about 91 per cent of registered accounts have yet to receive any contribution.
The figures highlight a major gap between pension registration and actual pension savings, raising questions about the effectiveness of current strategies for bringing more Nigerians, particularly workers in the informal sector, into the formal pension system.
PenCom acknowledged that the industry has concentrated heavily on registering new accounts without achieving a corresponding increase in actual contributions.
The commission warned that continuing to measure pension inclusion primarily by the number of accounts opened could create a misleading picture of progress.
According to the regulator, the real measure of inclusion should be the number of accounts that are actively funded.
PenCom said that without a significant change in how pension operators attract and retain contributors, the target of a 30 per cent funded ratio by the fourth quarter of 2026 is unlikely to be achieved.
The challenge is particularly important because the PPP is designed to provide a pathway into pension savings for people who may not have access to the mandatory Contributory Pension Scheme through formal employment.
The funding gap is also reflected in the amount of money flowing into the scheme.
PPP contributions during the quarter stood at N147.16 million, while cumulative contributions since the scheme began reached N1.66 billion.
While the growth in contributions is positive, PenCom believes the figures remain inadequate compared with the number of registered accounts.
The situation means thousands of Nigerians have taken the first step of registering for a pension account but have not progressed to the more important stage of making regular contributions.
For a pension system, that distinction is critical.
An unfunded account does not provide meaningful retirement protection. Registration creates the infrastructure for savings, but regular contributions are what ultimately build retirement wealth.
In response to the persistent funding gap, PenCom said it plans to change the way the PPP is implemented and measured.
The commission intends to publish funding-conversion targets for Pension Fund Operators and increase the use of Accredited Pension Agents.
It also plans to expand distribution partnerships with organisations that already have strong relationships with workers and small businesses.
These include cooperatives, fintech companies, telecommunications operators, trade unions and professional associations.
The objective is to move more Nigerians from simply registering for pension accounts to making regular contributions.
This approach could be particularly important for informal-sector workers, many of whom operate outside traditional payroll systems.
For this group, pension participation may require products that are easier to access, more flexible and better suited to irregular incomes.
