{"id":348248,"date":"2025-09-29T01:34:38","date_gmt":"2025-09-29T00:34:38","guid":{"rendered":"https:\/\/www.thetidenewsonline.com\/?p=348248"},"modified":"2025-09-28T18:38:24","modified_gmt":"2025-09-28T17:38:24","slug":"pencom-raises-capital-requirement-for-pfas-to-n20b-sets-december-2026-deadline","status":"publish","type":"post","link":"https:\/\/www.thetidenewsonline.com\/?p=348248","title":{"rendered":"&#8220;PenCom Raises Capital Requirement For PFAs To N20b &#8230;Sets December 2026 Deadline"},"content":{"rendered":"<div dir=\"auto\">The National Pension Commission (PenCom) has announced a sweeping revision to the capital requirements for Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs), raising the minimum threshold for PFAs tenfold, from N2 billion to N20 billion.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">The move, aimed at strengthening financial stability and operational resilience, marks one of the most significant regulatory shifts in Nigeria\u2019s pension industry in over two decades.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">In a circular titled \u201cRevised Minimum Capital Requirements for Licensed Pension Fund Administrators and Pension Fund Custodians\u201d, PenCom stated that PFAs with Assets Under Management (AUM) of N500b and above must now maintain a capital base of N20 billion plus 1% of the excess AUM beyond N500 billion.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">The revised capital requirements for both PFAs and PFCs would take effect immediately for new licenses, while existing operators have until December 31, 2026, to comply.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">PenCom would monitor compliance every two years based on audited financial statements, and any shortfall must be rectified within 90 days.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">PenCom emphasized that the review is anchored in Sections 60(1)(b), 62(b), and 115(1) of the Pension Reform Act (PRA) 2014. It aims to support the long-term viability of pension operators, improve service delivery, and ensure the sustainability of the Contributory Pension Scheme (CPS), which has now been in operation for 21 years.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">\u201cPFAs are therefore required to maintain adequate capital to sustain the achievements of the CPS, support ongoing pension reform initiatives, and deploy adequate resources to effectively fund operations,\u201d PenCom stated.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">PFAs with AUM below N500b are also required to meet the new N20 billion minimum. Special Purpose PFAs, such as NPF Pensions Limited, must hold N30 billion, while the Nigerian University Pension Management Company Limited is required to maintain N20 billion.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">\u201cThe capital requirement was reviewed in line with global best practice, which ensures that capital is proportionate to the risk exposure of the Pension Fund Operator. The new model aligned the capital requirement with the Pension Asset Under Management (AUM) and Assets Under Custody (AUC) of the PFAs and PFCs respectively&#8221;, the circular stated.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">For Pension Fund Custodians (PFCs), the minimum capital requirement has been raised from N2 billion, unchanged since 2004, to N25 billion plus 0.1% of AUC.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">The Commission cited the exponential growth in assets under custody and the increasing complexity of operations, including technology deployment, cybersecurity, and staff welfare, as key drivers of the revision.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">\u201cThe operating landscape of PFC business has evolved significantly over 21 years,\u201d the circular noted. \u201cThese developments underscore the need to reassess the adequacy of the existing capital threshold to ensure continued financial stability and effective risk management&#8221;, it stated.<\/div>\n<div dir=\"auto\"><\/div>\n<div dir=\"auto\">The announcement signaled PenCom\u2019s commitment to aligning Nigeria\u2019s pension industry with global standards, ensuring that operators are well-capitalized to navigate macroeconomic pressures and deliver secure retirement benefits to millions of Nigerians.<\/div>\n","protected":false},"excerpt":{"rendered":"<p>The National Pension Commission (PenCom) has announced a sweeping revision to the capital requirements for Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs), raising the minimum threshold for PFAs tenfold, from N2 billion to N20 billion. The move, aimed at strengthening financial stability and operational resilience, marks one of the most significant regulatory shifts [&hellip;]<\/p>\n","protected":false},"author":67315,"featured_media":348329,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[],"class_list":["post-348248","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts\/348248","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/users\/67315"}],"replies":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=348248"}],"version-history":[{"count":1,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts\/348248\/revisions"}],"predecessor-version":[{"id":348330,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/posts\/348248\/revisions\/348330"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=\/wp\/v2\/media\/348329"}],"wp:attachment":[{"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=348248"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=348248"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.thetidenewsonline.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=348248"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}