The National Pension Commission (PenCom) has introduced a policy allowing low-earning retirees to withdraw their entire Retirement Savings Account (RSA) balance in one lump sum or continue receiving monthly pensions, pending the implementation of the Minimum Pension Guarantee (MPG).

This directive, communicated in a memo signed by A.M. Salem, Head of PenCom’s Surveillance Department, follows the adjustment of the minimum wage from ₦30,000 to ₦70,000 by President Bola Tinubu, effective July 29, 2024.

New Withdrawal Criteria

Previously, retirees could withdraw only one-third of their RSA balances. The revised regulation under Section 4.1 (g) now permits retirees whose monthly pensions fall below ₦23,333.33 (one-third of the new minimum wage) to choose between:

1. Withdrawing their entire RSA balance en bloc.
2. Continuing with their current monthly or quarterly pensions until the MPG is finalized.

Requirements for En Bloc Withdrawals

Pension Fund Administrators (PFAs) have been instructed to process en bloc withdrawal requests in compliance with the new regulations. Required documents include:

• A signed consent form indicating the retiree’s informed choice.
• A hard copy application letter with a handwritten signature.
• A payment schedule template provided by PenCom.

PFAs are mandated to forward these documents to PenCom for approval.

Immediate Effect

The directive, effective immediately, ensures retirees receive benefits that align with the revised economic standards while maintaining flexibility in managing their retirement funds.

This policy aligns with PenCom’s commitment to enhancing the welfare of retirees and addressing the financial realities faced by low-income pensioners.