The management of the Stanbic IBTC Pension Managers Limited, a member of Stanbic IBTC Holdings PLC, has drum up support for the proposed micro pension scheme, stressing that it has the potential to provide the vital capital required for investment in critical sectors of the economy.
Making this clarion call was the Chief Executive, Stanbic IBTC Pension Managers Limited, Mr. Eric Fajemisin, who said the initiative offers enormous benefits to the society, even though there are also some challenges.
Fajemisin who spoke during an interactive session with the media in Lagos, also reviewed some provisions of the 2014 Pension Reform Act and the impact on the Contributory Pension Scheme (CPS).
The micro pension scheme, when finalised, would ensure improved standard of living for the elderly, guarantee the safety of funds and may provide access to other incentives, such as mortgage facilities and health insurance, Fajemisin stated. Other benefits would likely include flexible contribution remittances, the opportunity to make withdrawal prior to retirement and the enhancement of financial inclusion and attainment of economic stability objectives.
On the other hand, the initiative faces such challenges as insufficient awareness and negative perception towards pensions, modest financial literacy in the country, the high cost of carrying out awareness of the CPS, lack of reliable data on the informal sector and low buy-in by unions in the sector, among others. These challenges, he noted, are expected to be addressed prior to commencement of the scheme and thereafter.
On the enabling law, the Stanbic IBTC helmsman noted that the introduction of more stringent penalties for erring operators and directors, especially as it relates to mismanagement of funds, has engendered greater corporate governance, making it almost impossible to misapply pension funds by anyone. By increasing the contributions of the employer and employee to 10 and 8 percent respectively, Fajemisin said the Act has ensured the availability of more benefits to contributors at retirement. In addition, the Act makes the non-remittance of employees’ contribution by the employer an offence which the National Pension Commission (PenCom) can prosecute in court.
Stanbic IBTC Pension Managers Limited, he assured remains committed to rendering impeccable service to its clientele. “We make a promise to our clients: that they will retire very well. It is a promise we keep. That explains why we are represented in virtually every part of Nigeria, so that our customers will not have to go over long distances in order to meet with us. Retirement is a time to rest and enjoy the fruits of your labour,” he said.