Frequently Asked Questions

Micro Pension Plan refers to an arrangement under the Contributory Pension Scheme (CPS) that allows the self-employed and persons working in organizations with less than three (3) employees to make financial contributions towards the provision of pension at their retirement or incapacitation.

Micro Pension guarantees secured future through steady income at retirement.  It reduces old age poverty and the process is easy, simple and flexible.

Yes, Micro Pension Plan has been successful in countries like Ghana, Kenya and India.

The mandatory pension and Micro Plan are arrangements under the Contributory Pension Scheme (CPS).  The only difference between the two is the nature of participation.  Thus, the mandatory pension is obligatory for all eligible employees and both the employer/employee contribute towards the payment of the employee’s pension at retirement.  Micro Pension on the other hand is voluntary and solely funded by the contributor.

A micro Pension prospect must:

  1. Be a Nigerian, not below 18 years of age;
  2. Have a legitimate source of income;
  3. Belongs to trade/association/profession; and
  4. May be self-employed or an employee of an organization with less than three employees with or without a formal employment contact.

No. A contributory can only have one Retirement Savings (RSA) in his/her lifetime.

No. An individual who is contributing under the mandatory pension arrangement cannot participate in the Micro Pension Plan.

An eligible Micro Pension contributor can enroll/register through any Pension Fund Administration (PFA) of his/her choice obtain and complete the Retirement Savings Account (RSA) Opening Form either physically or electronically.  A unique Personal Identification Number (NIN) would be issued to the registered contributor.

The detailed list and address o al (PFAs) can be accessed via National Pension Commission’s website

The Pension Fund Administrator (PFA) manages and invest funds accumulated under Micro Pension Plan on behalf of the contributor, while the Pension Fund Custodian (PFC) keeps the fund and assets in safe custody.

There is effective monitoring and supervision of the Plan by the Commission through daily monitoring of the Plan asset and investment decisions made by Pension Fund Administrators to ensure that their decisions are in line with relevant laws and Investment Regulations issued by the Commission.

Yes.  The Pension Fund Custodian (PFC) has provided full guarantee of the total pension assets under its custody.  Thus, any kobo lost will be refunded by the Custodian.

Yes.  PFAs invest all pension contributions and all income from such investment activities are credited into RSA of the contributor.

No.  Subject to regulations issued by the commission, all interests, dividends, profit, investments and other income accrued to Micro Pension Fund and assets are not taxable.

No.  Investment are made by the Pension Fund Administrators in line with the Investment Regulations issues by the National Pension Commission?

Yes.  Micro Pension Plan is different from savings account maintained with a Commercial Bank because any savings made under the plan can only be withdrawn as monthly pension after retirement.  On the other hand, savings made with Commercial Banks can be withdrawn anytime as the need arises.

There is no stipulated minimum of amount of contribution under the Micro Pension Plan because it is dependent on the Contributor’s pension aspiration and financial capacity.  Thus, higher contributions will result in more money available for pension.

Contributions can be made daily, weekly, monthly or as may be convenient to the contributor and shall be subject to reporting requirements under the Money Laundering (Prohibition) Act.

Contribution under the Micro Pension Plan can be made cash deposit or electric transfer through any payment platform, or other financial service agents approved by the Central Bank of Nigeria (CBN).

No.  A contributor cannot access an amount in excess of his/her Micro Pension Plan account because the Pension Reform Act 2014 prohibits such transaction.

A contributor can access the balance in his/her RSA through two means namely; Contingent withdrawal and Retirement benefit withdrawal.

It is the withdrawal of that portion of the RSA balance (contribution plus returns on investment) made available for withdrawal to ease financial pressures or needs of the Micro Pension contributor before his/her retirement.

It is the withdrawal of that portion of the RSA balance that the Micro Pension Contributor shall be eligible to access as monthly pension upon retirement in accordance with the Regulation for the Administration o Retirement and Terminal Benefits.

A micro Pension Contributor can withdraw an amount from his/her contingent portion by applying to his/her Pension Fund Administrator (PFA) in a prescribed format.

A Micro Pension Contributor shall be eligible to access the contingent portion of the balance of his/her RSA three (3) months after making the initial contribution.  Subsequently, he/she can make withdrawals once in a week from the balance of the contingent portion of the RSA.

The Pension Fund Administrator is mandated to approve and pay the amount from the contingent portion within 48 hours of application for withdrawal.

The Micro Pension who secures a formal employment shall notify his/her PFA for conversion into the employment pension.  The Micro Pension contributor shall also retain his/her exiting RSA to be used for the mandatory payment.

A Micro Pension Contributor shall retire upon attaining the age of 50 years or on the health grounds.  However, a Micro Pension Contributor can chose to extend his retirement age beyond 50 years.

A Micro Pension contributor shall, upon retirement, access his/her retirement benefits through either Programmed Withdrawal of Life Annuity.

Programmed withdrawal is a mode of benefits withdrawal by which a Micro Pension retiree receives pension through his Pension Fund Administrator (PFA) on a periodic basis, i.e. monthly or quarterly.

Annuity is a method of receiving pension by a retiree through a contract purchased from a Life Insurance Company.  It provides a guaranteed periodic income (pension) to a retiree through his/her lie after retirement.

The Retiree Life Annuity is guaranteed for 10 years.  Thus, if a retiree dies before 10 years, the balance of the equivalent monthly pension to complete the remaining period up to 10 years would be paid to his/her beneficiaries.  Where the retiree dies after the guaranteed ten years, nothing would be paid to the beneficiaries.

The balance in a Micro Pension shall, in the event of death, be paid to the legal heirs of the deceased/contributor as may be appointed by a Will or Letter of Administration granted by a Probate Registry or as may be directed by court of competent jurisdiction in the State of residence of the deceased contributor, as the case may be.

No.  Micro Pension Plan only allows for conversion from Micro Pension Plan to the Mandatory Contributory Pension.

  • This new pension scheme is contributory
  • Fully funded
  • Privately managed
  • With third party custody of the funds and assets and
  • Based on individual accounts.
  • It ensures that everyone who has worked receives his/her retirement benefits as and when due.

The new scheme covers you if you work for government or in a private organisation that has three or more employees.

To download an Account Opening form, click here

Complete the application form to open a Retirement Savings Account. Submit the form and a white background passport size photograph to our nearest branch office. A personal identification number (RSA PIN) will be issued to you as evidence of successful registration.

There is no merger of private sector pension with that of the public sector pension since the sources of funding are not the same.

However, both are now being regulated under the same rules and regulations.

An employee shall make monthly contributions of a minimum of 8% of his/her total monthly emoluments (i.e., monthly basic salary, transport allowance and housing allowance) into his RSA.

The employer shall contribute a minimum of 10% of the employee’s monthly emoluments towards the retirement benefits of the employee.

Contributions towards your pension are taken out of your salary by your employer every month. In addition to this, the employer makes a contribution towards the pension. The two contributions are jointly paid to the Pension Fund Custodian who puts the funds into an account which is held in your name with your Pension Fund Administrator (PFA).

The contributions made for you are kept in a Retirement Savings Account which is managed by your PFA. The PFA must issue a Statement of Account to you at least once every quarter or on demand. You will also receive transactional and quarterly balance SMS alerts so that you can watch and monitor your pension as it grows.

The RSA is similar to a bank account except that no contributor can withdraw money from the RSA before his/her retirement. The PFA is required to invest the money and issue statements of account at least once every quarter to the contributor or on demand.

Movement from one employment to another does not affect pension under the new scheme. The account (RSA PIN) remains yours for life. You just need to notify your PFA of the change, forward your RSA PIN and PFA details to your new employer to ensure that the pension contributions/deductions from the new employer will be sent to that account.

There is no qualifying period for pension. If an employee works for an employer for one month, his/her pension contribution will be paid by the employer into the employee’s Retirement Savings Account (RSA) for that month. If the employee moves on to work for another employer for another 1 year, the pension contribution will be paid by the second employer for that period of 1 year and it goes on and on like that.

You can have access to the RSA upon retirement at the age of 50 years or more. Similarly, if an employee retires before the age of 50 years due to mental or physical incapacity, he/she can access RSA immediately. Also, an employee who resigns or loses employment under the age of 50 years is entitled to withdraw 25% from the balance of his/her RSA if he/she stays for 4 months without securing another paid employment.

The balance of 75% of the RSA will be invested to generate additional income and the RSA holder will continue to receive statement showing the income being generated. Upon attaining the age of 50 years and if the balance in the RSA is above N500,000, the RSA holder will be placed on a monthly pension plan. But if the balance is N500,000 or less, the amount will be paid to the RSA holder en-bloc. In the event of death, the entire amount in the RSA will be paid to the holder’s nominated beneficiary.

No, there is no gratuity under this scheme. However the law provides for payment of Lump Sum benefit (minimum of 25% and maximum of 50%) to a retiree at retirement from the balance standing to the credit of his/her RSA. This benefit payment is made provided the balance after the withdrawal could purchase an annuity or fund monthly payments that would not be less than 50% of his/her monthly pay as at retirement.

However, an employer may choose to pay any other severance benefits (by whatever name called) over and above the retirement benefits payable to the employee subject to the terms and conditions of his/her employment.

Under Normal Retirement (50 years above) the customer is entitled to minimum of 25% and maximum of 50% of RSA balance as Lump sum payment and a monthly or quarterly programmed withdrawal.

Retiree above 50 years with 500,000 naira or below as RSA balance is paid off (enbloc payment).

Temporary loss of job and voluntary retirement before the age of 50 years is paid 25% of RSA balance 4 months after exit.

Death benefits is full payment of RSA balance to nominated Next of Kin, this also applies to group life insurance payment.

Where an employee/retiree who has been contributing under the new pension scheme dies, his/her retirement benefits shall be paid to his/her beneficiary under a WILL. In the event that the deceased did not leave a WILL, the retirement benefits shall be paid to any person appointed by the Probate Registry as the administrator of the estate of the deceased.

The total contributions will be paid out by the employer directly to a Pension Fund Custodian and will be managed and invested by the Pension Fund Administrator (PFA) of the employee’s choice.

You can increase your pension by making additional voluntary contribution over and above the 8% prescribed by PRA, 2014. Similarly, your employer may increase the employer’s pension contribution above the 10% minimum contribution prescribed by law.

The PFA or your employer cannot have access to the funds in your Retirement Savings Account (RSA). The account operates on your exclusive instruction.

The National Pension Commission is empowered by the Pension Reform Act 2014 to supervise and regulate the new pension scheme

The National Pension Commission issues licenses to PFAs and Custodians, regulates their activities, and generally formulates, directs and oversees the overall policy guidelines on pension matters in Nigeria.

The pension funds and assets in the Retirement Savings Account (RSA) are kept by the PFC and as such the liquidation of the PFA will not affect the funds and assets. Besides, under the Pension Reform Act 2014, every PFA is expected to maintain a statutory reserve fund as contingency fund to meet claims for which it may be liable as may be determined by National Pension Commission.

All those managing or keeping custody of pension funds and assets will be licensed and continually regulated and supervised by the National Pension Commission.

It is the duty of the PFAs to administer the contributions and invest in such a way that will ensure safe and reasonable returns on investment. The reserve fund created by the PFAs under the Act would compensate for any erosion of the value of the contributions.

You can call our Call Centre on 09-4615700 or send us an e-mail Our Call Centre can also be reached on 09029684547, 09029684548.

We are on FacebookTwitterInstagram via Premium Pension. You may also visit any of our branch offices or service centres located in First Bank major branches throughout the country. We are available for live chat, click here.


The Multi-fund Structure for RSA Funds otherwise known as the life-cycle investment structure was conceived by the Commission to align contributors’ risk appetite with their investment horizon, at each stage of their life cycle. The multi-fund structure comprises Fund I, Fund II, Fund III and Fund IV (Retirees Fund). The respective funds are distinguished by their overall exposure to variable income instruments and the age profile of the contributors.

The term variable-income instruments refer to investments that provide their owners with a rate of return that is dynamic and determined by market forces. Variable-income securities provide investors with both greater risks as well as rewards.

Exposure to variable income instruments in the context of the multi-fund structure is the sum of a PFA’s investments in Ordinary Shares and participation units of Open Close-ended and Hybrid Funds; Real Estate Investment Trust; Infrastructure Funds; and Private Equity Funds comprising its current holdings and any future financial commitments to the acquisition of participation units in these Funds.

Multi-fund Structure Snapshot




Age <50 <50 ≥50 ≥50
Risk Appetite High MediumLowLow
Allocation to Variable Income 20%-75% 10%-55% 5%-20% 0%-10%
Default Option NoYesYesNo
Membership Strictly on request but not accessible to Retiree and Active Contributors of 50 years and above Default for active Contributors of less than 50 years Default for active Contributors of 50 years and above Strictly for Retirees that opt for Programme withdrawal

Fund Membership

Effective from the date of implementation, PFA shall allocate contributors to the various fund type by default accordingly.

  • Membership of Fund I shall strictly be by the formal request by a Contributor.
  • Active Contributors who are less than 50 years as at their last birthdays shall be assigned to Fund II.
  • Active Contributors who are 50 years and above as at their last birthdays shall be assigned to Fund III.
  • Fund IV shall strictly be for RSA retirees only.

For contributors choosing the funds in which they desire to be, the following shall apply:

  • An active Contributor in Fund II who wishes to be assigned to Fund I shall make a formal request to his/her PFA.
  • An active Contributor in Fund III who wishes to be assigned to Fund II shall make a formal request to his/her PFA.
  • An RSA Retiree or active Contributor who is 50 years and above shall not be allowed to choose Fund I.
  • An active contributor in Fund II is not allowed to opt for Fund III.
  • Fund III is strictly for active contributors above 50 years.

Objectives of the Multi-Fund Structure

  • Achieve optimum returns for contributors by aligning their pension saving with their individual risk/return profile.
  • Provide investment portfolio choices to contributors.
  • Enhance the safety of pension assets through adequate portfolio diversification

Benefits of the Multi-Fund Structure

  • Provide greater choice and control to contributors on how their pension funds are invested.
  • Investment in financial instruments that provide a cash flow that matches the profile of the contributors.
  • Increased investment in Alternative assets which will essentially protect against inflation and help to facilitate improved returns over the long term.
  • Provide for investment strategies that will better diversify risk and sustain returns


  • Provides choice – Different fund options based on risk profile or age.
  • Provides control – there is an opportunity for a client to switch between funds based on change in risk appetite and investment preferences. It is advised that this is done within a ‘controlled’ and informed manner.
  • Better alignment of investment outcomes/returns with preferred objectives.

On the commencement date, the default mechanism will apply. All active members that are below 50 years will be placed in Fund II and active contributors above 50 years would be placed in Fund III. Subsequently active contributors can apply to switch between funds. An active contributor can switch from Fund II to Fund I while an active contributor in Fund III can switch to Fund II, but not Fund I. All retirees and active contributors above 50 years cannot switch to Fund I.

To switch from one fund to another, after the initial default placement into funds based on age, the contributor must submit a formal request to his/her PFA.

For now, your Voluntary Contribution will remain invested within the same fund as your monthly regulatory contribution.

There is no relationship between the transfer window and the multi-fund structure. The transfer window allows the customer the choice of moving his/her RSA from one PFA to another while the multi fund allows a customer the choice of moving from one fund to another within the same PFA.

No. The balance in your account will not be affected.  However, your unit price will change, if you fall within the category of those to be moved to Fund III, as your default i.e. based on your age. Funds I and III will have an opening unit price of N1.0000, on take-off date, while subsequent additions to the fund will be done at prevailing prices. The choice of Fund I is strictly by request and not for individuals above age 50.

You may migrate from one Fund to another a maximum of twice in a calendar year. The first transfer in a calendar year shall be at no cost to you, while any subsequent transfer in the same calendar year shall be at a flat rate of ₦1,000.00.

No, as a retiree you are not allowed to move out of Fund 4.

To every investment return, there is a level of risk involved. Everyone has a limit to the amount of risk they are willing to take on their investment or the amount of uncertainty they can tolerate. Once a person is nearing retirement, it is advisable that they limit the amount of risks they take and reduce exposure to investments with relatively high volatility/risk, especially as they would start drawing down on their pensions within a short period.


Thus, allowable exposure to variable income instruments have been designed such that Fund I has the highest allowable limit with potentially higher returns and corresponding higher volatility/risk, followed by Fund II, III and IV respectively. This reduces the risk and uncertainty of contributors in line with their ages.

The Multi-Fund structure provides more alignment between your retirement goals and risk appetite. It therefore offers a better chance for your pension assets to meet your expectations at retirement.

To switch from one fund to another, the contributor must submit a formal request to his/her PFA.  Please note that rules on age restrictions for each fund will apply.

The balance in your RSA will not change due to the movement to the multi-fund structure because the entire balance would be moved to the appropriate fund, if required, without charges. However subsequent growths in your balance would depend on contributions such as the mandatory monthly contributions, voluntary contributions as well as returns generated by the PFA on that particular fund.

An active contributor may migrate from one Fund to another a maximum of twice in a calendar year (12 months)

Any additional requests for switches among Funds within a 12 month period by the active Contributor shall be at a flat rate of ₦1,000.00.

Before the take-off date, we will continue to  share necessary information via email, text, online (our website and social media handle)  that will provide some basis for your decision – i.e. in the case where you want to make a different fund from your ‘default fund’. In the event you want to switch between funds, we will also continue to provide needed information that will guide you through the process of assessing risk and making an informed decision.

Fund Prices

Our Administrative Fee: View Details ₦100 Normal RSA
₦20 below ₦4,000 for Micro Pension
₦80 above ₦4,000 for Micro Pension

Rate of Returns: View Details FUND I - 6.74%
FUND II – 10.74%
FUND III – 13.51%
FUND IV – 12.22%

Number of RSAs Registered: 691,314