Nigeria's pension industry recorded rapid expansion over the past year, with total assets under management rising 22 per cent to N26.7 trillion at the end of October.
According to analysts at the Pension Fund Operators Association of Nigeria (PenOp), the expansion was driven by strong market performance, increased contribution inflows and wider diversification across asset classes.
Investments in domestic ordinary shares increased by 82.0 per cent from N2.11 trillion to N3.84 trillion, indicating continued confidence in equity markets and long-term growth assets.
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Holdings of FGN securities recorded the highest increase among traditional assets, rising by 17.6 per cent from N13.57 trillion to N15.96 trillion, as pension funds increased investments in government-backed instruments.
Analysts said allocations to money market instruments increased by 30.9 per cent from N2.20 trillion to N2.88 trillion, reflecting higher liquidity conditions amid attractive short-term yields.
Mutual fund investments more than doubled, recording an increase of 107.6 per cent, from N106.85 billion to N221.86 billion, highlighting the growing pension participation in long-term national development projects.
Investments in infrastructure funds increased by 48.1 per cent, from N177.24 billion to N262.57 billion, underscoring the increased diversification through pooled investment vehicles.
Similarly, private equity investments increased by 89.5 per cent from N123.04 billion to N233.10 billion, reflecting the growing appetite for alternative assets and long-term value creation.
Overall, the period saw strong pension fund growth across both traditional and alternative asset classes, reinforcing capital markets development and the sector's growing role in economic growth, PenOp said.
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PenCom, in its third quarter report on industry performance, said the pace of reform has inspired stability, growth and confidence in Nigeria's pension system.
“The third quarter of 2025 marks a period of resilience and reform-driven growth for Nigeria’s pension industry,” the commission said.
“Supported by macroeconomic stability, rising capital market confidence and deepening regulatory oversight, PenCom consolidated gains in fund performance, compliance and coverage,” the regulator said.
It said total pension assets increased to N26.09 trillion, while industry reforms continued to enhance transparency, accountability and public confidence in the Contributory Pension Scheme (CPS).
According to the Commission, coverage expanded with over 129,154 new Retirement Savings Account (RSA) registrations, supported by increased youth participation and better gender inclusion.
“Gender inclusion improved, with female registration increasing to 40.3 percent, reducing the year-on-year gender gap by 6.5 percent.”
With timely payment of accrued entitlements and better service delivery under DBS, retirement benefit administration remained stable.
Compliance enforcement was strengthened through engagements in collections, employer monitoring and continued state-level CPS adoption.
Total pension contributions in the third quarter (Q3) of 2025 stood at N503.19 billion, reflecting strong remittance compliance across the public and private sectors.
The private sector contribution increased by 67.30 per cent from N202.47 billion to N338.65 billion in the second quarter (Q2) of 2025.
The public sector contribution declined from N223.95 billion to a total of N164.54 billion in the second quarter of 2025 due to seasonal fiscal disbursement.
A total of N34.64 billion in accrued pension entitlements was paid to 9,707 retired and deceased employees, reflecting the Federal Government’s continued commitment to legacy liabilities.
Also at the end of Q3, 5,950 Electronic Pension Clearance Certificates (e-PCCs) were issued to compliant employers, covering N34.34 billion in contributions from 64,457 employees, while N2.07 billion was recovered from 49 defaulting employers, taking the total recovery since 2012 to N32.27 billion.
“These results underscore PenCom's commitment to continued enforcement of compliance, efficient fund management and protecting the interests of contributors,” the commission said.
