The National Pension Commission (PenCom) has reviewed the minimum capital requirements for Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs) as part of efforts to enhance the financial stability of the pension industry.

The directive was contained in a circular signed by Mr. Saleem Abdulrahman, Director of the Surveillance Department at PenCom.

The review, carried out in line with the Pension Reform Act 2014 and international best practices, requires PFAs to maintain capital levels proportionate to their Assets Under Management (AUM), while PFCs must align their capital thresholds with Assets Under Custody (AUC).

According to the circular, PFAs with AUM of N500 billion and above must maintain a minimum capital of N20 billion plus one per cent of the excess above N500 billion. PFAs with AUM below N500 billion are required to maintain a capital base of N20 billion.

Special-purpose PFAs, such as NPF Pensions Ltd., must hold N30 billion, while the Nigerian University Pension Management Company Ltd. is to maintain N20 billion.

“The minimum capital for new PFA licences has been set at N20 billion with immediate effect. Similarly, the capital requirement for PFCs has been raised from N2 billion, set in 2004, to N25 billion plus 0.1 per cent of AUC. New PFC licences will also require a minimum of N25 billion,” the commission stated.

PenCom explained that the adjustments were necessary to reflect the exponential growth of pension assets, increasing operational complexity, and the rising need for robust technology, cybersecurity, and enhanced service delivery.

Operators have until 31 December 2026 to comply with the new thresholds.

“Compliance will thereafter be monitored biennially using audited financial statements, with any identified shortfalls to be rectified within 90 days,” the circular added.