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The Director-General of the National Pension Commission (PenCom), Omolola Oloworaran, has identified Nigeria’s vast informal sector as a critical growth frontier for pension inclusion and long-term domestic capital mobilisation.
In a policy opinion, Oloworaran noted that while pension reforms over the past two decades have strengthened governance, transparency, and asset growth, participation has remained heavily concentrated within the formal workforce—leaving millions of economically active Nigerians outside the retirement safety net.
According to recent industry data, pension assets surpassed ₦27 trillion as of December 2025, with more than 10 million Retirement Savings Accounts (RSAs) registered. However, the bulk of these contributors are salaried workers in the public and private formal sectors.
A Structural Gap in Nigeria’s Labour Market
Oloworaran pointed out that over 75 million Nigerians operate within the informal economy—including traders, artisans, farmers, transport operators, and small-scale entrepreneurs—yet the majority lack structured retirement savings.
She described this exclusion not merely as a social welfare issue but as a structural economic vulnerability.
A sustainable economy, she argued, cannot thrive when a significant proportion of its workforce enters old age without financial security. Expanding pension coverage is therefore both a social imperative and a macroeconomic priority.
Unlocking Trillions in Long-Term Capital
Beyond social protection, the PenCom DG emphasised the capital formation potential embedded within the informal economy.
If even a modest share of informal sector earnings were channelled into regulated pension savings, it could unlock trillions of naira in long-term domestic capital—funds that could be deployed toward infrastructure development, housing, power projects, enterprise financing, and broader economic transformation.
Such capital pools, she noted, are essential for strengthening financial markets and reducing reliance on external borrowing.
Accredited Pension Agents to Drive Inclusion
To close the coverage gap, PenCom has introduced the Accredited Pension Agent (APA) framework—an initiative designed to take pension enrollment directly into markets, farms, workshops, and local communities.
The model leverages technology-enabled mobilisation and proximity-based engagement, aligning incentives between agents and Pension Fund Administrators (PFAs). Compensation under the framework is tied to sustained contributions and participant retention, ensuring long-term engagement rather than one-off sign-ups.
PenCom recently issued its first APA licence to Awabah, with additional fintech firms, cooperatives, telecommunications companies, and payment service providers expected to join as the programme scales nationwide.
Aligning with National Economic Priorities
Oloworaran noted that the initiative supports the broader economic agenda of President Bola Tinubu, particularly efforts focused on financial inclusion and strengthening domestic capital markets.
By deepening pension penetration within underserved segments, the Commission aims to convert informal earnings into structured long-term savings—enhancing retirement security while simultaneously strengthening Nigeria’s investment base.
As Nigeria advances reforms aimed at economic resilience and inclusive growth, the informal sector may prove to be the most significant untapped lever for both social protection and sustainable capital development.
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