ByChidimmaOkwara,
The National Pension Commission (PenCom) has launched Foreign Currency Pension Contributions (FCY Pension Contributions) Guidelines, a groundbreaking move that allows diaspora Nigerians and foreigners to save for retirement directly in US Dollars ($) under the Contributory Pension Scheme (CPS).
This initiative is aimed at reforming the pension landscape, deepening participation, and attracting foreign currency inflows into the Nigerian economy.
The new guidelines, issued in September 2025, extend the Nigerian pension system to a wider group of individuals who earn in foreign currency.
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1. Eligibility and Scope
The scheme is open to three main categories of contributors:
- Nigerians living and working abroad (Diaspora Nigerians).
- Nigerians working in Nigeria who earn all or part of their salary in foreign currency.
- Expatriates/Foreign workers employed by international organizations and companies in Nigeria.
2. Contribution and Account Requirements
- Currency: All contributions must be remitted in US Dollars ($), even if a contributor earns in another foreign currency (like Euros or Pounds).
- Retirement Savings Account (RSA): Contributors will open an RSA with a Pension Fund Administrator (PFA) that is specially denominated to receive and manage foreign currency contributions.
- Remittance:
- Diaspora Contributors: Must remit contributions using a Non-Resident Nigerian Ordinary Account (NRNOA).Resident Contributors (earning FCY): Must remit contributions from their Domiciliary Accounts (DA) to the PFA’s foreign currency collection account.
- Transparency: PFAs are mandated to report any single contribution exceeding $10,000 to the Nigerian Financial Intelligence Unit (NFIU) within 24 hours to ensure compliance and transparency.
4. Strategic Objectives
PenCom sees the new dollar pension scheme as a significant reform that achieves multiple objectives:
- Deepening CPS Participation: Expands the reach of the Nigerian pension scheme to millions of Nigerians living abroad who previously had limited access.
- Attracting Forex: Provides a structured, secure mechanism to channel a portion of diaspora remittances and foreign earnings into Nigeria’s financial system, boosting foreign currency liquidity.
- Diversifying Pension Assets: Strengthens the investment potential of pension funds by allowing for contributions and investments in a stable foreign currency, providing a hedge against domestic currency devaluation.
