The National Pension Commission (PenCom) has approved new investment opportunities for Pension Fund Administrators (PFAs), authorising them to channel part of pension assets into foreign currency-denominated instruments.
This comes as Nigeria’s pension fund assets hit ₦24.6 trillion as of June 2025.
Under the newly released Guidelines on Foreign Currency Pension Contributions, PenCom also directed PFAs and Pension Fund Custodians (PFCs) to report all foreign currency pension contributions above $10,000 to the Nigeria Financial Intelligence Unit (NFIU) within 24 hours.
Until now, only Closed Pension Fund Administrators (CPFAs) were permitted to invest in foreign currency assets, while PFAs were restricted. The new framework opens up broader opportunities for fund diversification and improved returns.
According to PenCom, the objectives of the guidelines include:
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Expanding access to the Contributory Pension Scheme (CPS) for Nigerians earning in foreign currency, including those in the diaspora.
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Providing a secure and transparent mechanism for foreign currency contributions.
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Strengthening pension fund investments through diversified currency inflows.
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Ensuring compliance with both local regulations and international standards.
On modalities for contributors, the guidelines specify that:
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Diaspora contributors must open a Non-Resident Nigerian Ordinary Account (NRNOA) in line with Central Bank of Nigeria (CBN) requirements, from which contributions will be remitted to the PFA’s foreign currency collection account with the PFC.
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Resident contributors are required to open a domiciliary account with the PFC’s collecting bank and remit contributions to the same collection account.
PenCom further clarified that:
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PFAs must invest foreign currency contributions within Nigeria, in line with allowable asset classes under its investment regulations.
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Such investments shall be executed and retained in foreign currency (USD).
The commission emphasised that the move is designed to deepen the pension industry’s resilience, improve investment diversification, and expand participation in the CPS, particularly among Nigerians in the diaspora.
