Pension payment types for all contributors in the Contributory Pension Scheme in Nigeria
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November 27, 2019

The Pension Reform Act 2014 extensively provides for benefits that employees are entitled to and this covers a range of situations. The benefit payments under the Pensions Scheme are more than just the monthly pension payment one receives at retirement. In addition, they include payments for situations like when employees disengage from employment for a particular period before reaching retirement age, disengagement under critical medical conditions as well as when an employee transit to the great beyond.
Formally, they are listed as:
  1. Enbloc
  2. 25% Temporary Access
  3. Lump Sum
  4. Additional Voluntary Contribution (AVC)
  5. Death Benefit Payment
  6. Medical Grounds
 
  • ENBLOC
    This benefit is usually received at retirement where the total balance in the retirees’ Retirement Savings Account is ?550,000. There are some documentation requirements to be provided and conditions to be fulfilled by the retirees in order to access this payment.
 
  • 25% TEMPORARY ACCESS
    This covers for situations where active employees disengage from employment for a period of at least four months. The Pension Reform Act provides for those in this category to access 25% of the total balance in their Retirement Savings Account, under the condition that these employees have not attained the age of 50 and have not secured another employment after 4 months of disengagement. Requirements to access this may be found here.
 
  • LUMP SUM AND PROGRAMMED WITHDRAWAL
    This is applicable to employees who retired voluntarily upon attainment of age 50 or retired compulsorily according the terms/conditions of their employment. Retirees are entitled to initial Lump Sum payment amounts of between 25% to 50% of their RSA balances and regular / periodic pension’s payment over their expected life. It is usually calculated using the unified Pensions Calculator issued by the National Pension Commission (PenCom). Click here to access the documentation requirements and application form.
 
  • ADDITIONAL VOLUNTARY CONTRIBUTION
    This is a contribution that employees are permitted to make in addition to their regular pensions contribution. This is usually done upon a formal request by the employee to his Human resource manager. Deductions for this purpose are always from source. A benefit from this contribution is that fifty percent can be accessed inclusive of the investment income from this purse once every 2 years provided contributions have been retained in employees Retirement Savings Account for minimum period of two years. Click here to sign the AVC mandate.
 
  • DEATH BENEFITS
    As will be the fate of us all even though at different times, we will transit to our final resting place. The Contributory Pensions Scheme ensures that when this happens, the officially named beneficiaries (as stated in a valid Will or a valid Letter of Administration) can access total benefits of the deceased. This benefit is usually paid upon submission of required documents as well as a duly filled application form. This same process covers for persons who have been declared missing by the Police and have remained so for a period of 12 months.
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In addition, the Act also provides for Non-Nigerian natives who are enrolled under the Contributory Pension Scheme and want to relocate to their country to access the entire balance in their Retirement Savings Account upon fulfilment of documentation requirements. There is also provision for employees who are forced into retirement due to certain medical conditions. The essence of the Pensions scheme is not to only ensure your comfort at retirement. It goes further to make provisions for situations of financial incapacity due to loss of jobs, early retirements due to critical health conditions and other factors as enumerated above.
Leadway Pensure; as a reliable Pension Fund Administrator, is committed to ensuring prompt benefit payments through her efficient technological drive and availability of seasoned professionals to give you an amazing customer experience. In addition to receiving exceptional service at our branch locations, we have created self-service channels for you to apply for some of these benefits (24% Benefit and AVC withdrawals) on our Mobile App and other online platforms. Contact us today via email at info@leadway-pensure.com or call us on 01-2800800 for more detail on the benefits available to you.
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