Pension Fund Administrators and Life Insurance companies have made N1.63 trillion lump sum payments on programmed withdrawal and annuity to 442,000 retirees in the last 15 years.
This disclosure was made by the Chief Executive Officer (CEO) of the Pension Fund Operators Association of Nigeria, Oguche Agudah at a Media parley.
The data mined from National Pension Commission (PenCom) captured some of the years lump sum programmed withdrawal was paid during the third quarter (Q3) of the stated years.
In Q3, 2011, N99.29 billion was paid to 35,419 applicants, and N288.54 billion was paid to 117,502.
In the same fashion, records of Q3, 2019 showed that 227,400 applicants were paid N589.33 billion.
The lump sum paid to 315,112 applicants in Q3 2022 was N887.23 billion, and at the end of Q3, 2023, N964.23 billion was paid to 330,201 applicants.
A recent report released by the Commission, indicates that the number of retirees that opted for annuity option of pension declined by almost 10 percent to 3,156 in the second quarter (Q2) of 2023, from 3,505 recorded in the first quarter (Q1) of 2023 as against an increase of 27 percent in the first quarter, (Q1) 2023.
Under the Contributory Pension Scheme (CPS), a retiree has the option to choose between enrolling on annuity with part of his pension savings after retirement or take up programmed withdrawal of the pension savings with a Pension Fund Administrator (PFA).
The Pensions Reform Act opened enormous business opportunity for the insurance industry by introducing life annuity, which underwriters sell to retirees under the CPS.
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