The Nigerian Federal Government has unveiled a new pension scheme that allows Nigerians living abroad and foreigners earning in Nigeria to contribute to their retirement savings in foreign currency. This initiative aims to broaden participation in the Contributory Pension Scheme (CPS), attract foreign currency inflows, and offer contributors greater flexibility in managing their retirement funds.
Under the scheme, eligible participants can open a Retirement Savings Account (RSA) with a Pension Fund Administrator (PFA) and make contributions in U.S. dollars. Contributions can be made daily, weekly, or monthly, depending on the contributor’s payment schedule. The funds are held in a Foreign Currency Dollar Fund (FCDF) and invested in dollar-denominated instruments, including U.S. government bonds, Eurobonds, and approved Nigerian corporate bonds listed on international exchanges.
Contributors must provide valid identification, such as a National Identification Number (NIN) and an international passport, and complete Know Your Customer (KYC) verification. Pension Fund Administrators are required to credit contributions to the RSA within 24 hours of receipt, and any contribution exceeding $10,000 must be reported to the Nigeria Financial Intelligence Unit.
Withdrawals are allowed up to twice a year before retirement, with funds accessible in either U.S. dollars or their naira equivalent upon retirement. The scheme offers currency diversification, promotes transparency, and enables Nigerians abroad and expatriates in Nigeria to secure their retirement benefits while boosting the overall growth of the Nigerian pension system.
