• Monday, April 22, 2024
businessday logo


National Pension Commission emphasizes need for SMEs to register for micro pension plan

The National Pension Commission (PenCom) has emphasized on the need for SMEs to register under the Micro Pension Plan that allows the self employed and organisations with less than three employees to make financial contributions towards the provision of pension at their retirement or incapacitation.

Speaking to BusinessDay at the Enugu International Trade Fair on the category of Small and Medium Enterprises, the Head, Corporate Communications of PenCom, Abdulqadir Dahiru, said that the policy was looking at artisans, traders, mechanices, shoe makers and other self-employed persons, saying that they are free to enroll in the Micro Pension Plan of the Commission to guarantee a functional retirement plan they can hold-on to.

He said that one of the major requirements for registration was that such individuals must be members of the association, because it is pertinent to show that the person is an informal worker.

Read also: APC suspends Lauretta Onochie over alleged anti-party activities in Delta

“We are in this trade fair to extend the campaign of Micro Person Plan to Small and Medium Enterprises and to educate them on the importance of contributory pension plan,” Dahiru said.

He also said that the only difference between Mandatory pension and Micro Pension plan was that in the former both the employer and employee contribute while the Micro Person Plan is voluntary and solely funded by the contributor.

He further explained that every remittances made into the RSA, has 40 percent for contingency while normal retirement is 60 percent but that such a person must have contributed for at least three months to access the usual content portion.

Dahiru noted that about 90 percent of workers in Nigeria are in the informal sector, adding that this category of workers have no pension protection for old age hence, “there is a risk of old age poverty”.

According to him, “the Micro Pension Plan platform provides workers in this sector the opportunity to easily register and contribute in a flexible manner and in a safe and secure environment for their pension at retirement.”

The head of the corporate commission disclose that the company has come up with a new product that helps people own their own houses, the new policy which according to them was created to cater for active contributors.
“Having contributed for 60 months that is (5years) the person can use 25percent of what is in the (RSA) for the payment of equity contributions to buy a house.

“The Micro Pension Plan is a flexible plan, where the artisans, traders and even a woman that sells fried bean cake (akara) can register with and agree a periodic amount he/she would be contributing according to his/her earnings,” he said.