PenCom Eases Benefit Payments Process For Retirees

Oluwakemi Kindness

The National Pension Commission (PenCom) says effective from 1st June 2025, Pension Fund Administrators (PFAs) would no longer be required to seek approval or obtain a “No Objection” from the Commission before processing and disbursing benefits, including Programmed Withdrawal, Retiree Life Annuity, and Temporary Loss of Employment benefits, among others.

PenCom, however, noted that PFAs must continue to submit requests for approval to the Commission regarding depleted RSAs and death benefit applications, in accordance with Section 8 subsection 2 of the Pension Reform Act 2014.

According to a circular on Approval of Benefits to Holders of Retirement Savings Accounts by Licensed Pension Fund Operators, dated 12 March 2025, PFAs are mandated to process and approve eligible benefit applications within two (2) working days of receiving all required documentation.

Also Pension Fund Custodians (PFCs) must ensure payment of the approved benefits within 24 hours of receiving instructions from the PFAs.

The Commission explained that the new policy is not only aimed at expediting the payment of benefits to Retirement Savings Account (RSA) holders, but part of ongoing efforts to enhance operational efficiency and service delivery.

It said, it would continue to monitor the implementation of this policy through its regulatory technology platforms and other supervisory mechanisms to ensure full compliance.

PenCom said, prior to this directive, 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, adding that the new policy was designed to streamline the benefit payment process, significantly reducing delays and improving access to entitlements for retirees and other RSA holders.

PenCom reminded the RSA holders that timely submission of the necessary documentation to their PFAs was crucial for seamless access to benefits.

“Prospective retirees are advised to submit all relevant documents at least six (6) months before retirement. All benefit applications must be supported by the documentation prescribed in the Commission’s Regulations and Guidelines,” it said.