National Pension Commission (PenCom) has issued operating license to IGI Pension Fund Managers Limited to operate as a pension fund administrator under the contributory pension scheme in Nigeria. Mr. Yinka Obalade is the company's Managing Director.

This brings to 26 the total number of Pension Fund Administrators (PFAs) so far registered by the PenCom to operate in the country. The development also confirmed the statement made by the PenCom's Director General, Muhammad Ahmad, that the licensing of operators under the new contributory pension scheme would be a continuing exercise.

Under the contributory pension scheme established by the Pension Reform Act 2004 for all workers in the public and for organisations in the private sector with a minimum of five employees, the PFAs play very important roles.

Specifically, Section 44 of the Act states that as from June 25, 2004 when the law became effective, pension funds shall only be managed by pension fund administrators licensed by the commission.

The licensed PFAs are required to carry out certain functions such as the opening of retirement savings account for all employees who choose them and make sure they have a Personal Identity Number (PIN).

They are also to invest and manage pension funds and assets in accordance with the provisions of the Pension Act; while equally maintaining books of account on all transactions relating to pension funds managed by them.

Pension managers provide regular information on investment strategy, market returns and other performance indicators to the PenCom and employees or beneficiaries of the retirement savings accounts.

PFAs are required to provide customer service support to employees; including access to employees account balances and statements on demand; and cause to be paid retirement benefits to employees in accordance with the provisions of the Pension Act.

Besides, the PFAs are responsible for all calculations in relation to retirement benefits; and may be required to carry out other functions as may be directed, from time to time, by the commission.

Organisations proposing to operate, as a pension fund administrators are required to apply to the PenCom for license and if the commission is satisfied that the applicants meet the requirements set out in the Section 50 of the Act, licenses will be issued to such applicants to operate as PFAs.

Before any organisation can be issued with operating license to operate as a PFA, such an organisation must be a limited liability company incorporated under the Companies and Allied Matters Act whose sole object is the management of pension funds. To discourage frivolous applications and to ensure credibility, such an organisation wanting to be a PFA is also required to have a paid up share capital of N150 million and demonstrate professional capacity to manage pension funds and administer retirement benefits.

Where an applicant for a license to operate as a pension fund administrator is a life insurance company licensed by the National Insurance Commission, however, provided such a company does not engage in any other business, it may be granted a license by PenCom. Nonetheless, such applicants are required to meet all other requirements mentioned above.

IGI Pension Fund Managers Limited is a subsidiary of Industrial and General Insurance Plc (IGI).

IGI emerged on the Nigerian insurance landscape in January 1992 bringing a fresh breadth of dynamism and innovation into the industry. The company has since established a reputation for the provision and delivery of products and services of high use value not only in general insurance but especially in the specialized areas of oil, energy, aviation, engineering and industrial risks management.