PenCom Channels N28trn into Infrastructure Financing

The National Pension Commission (PenCom) has unveiled plans to establish a pension-backed investment consortium aimed at financing critical infrastructure projects using the industry’s asset base of over N28tn.

The proposal was announced at the First Quarter 2026 Pension Industry Leadership Council press briefing held in Lagos. During the event, stakeholders outlined strategies to reposition pension funds as catalysts for economic growth.

The Director-General of PenCom, Omolola Oloworaran, stated that the initiative is part of broader efforts to transition pension funds from passive investment vehicles into active drivers of national development.

According to Oloworaran, the proposed Nigerian Pension Industry Investment Consortium will create a structured platform for channelling long-term pension capital into bankable infrastructure projects while ensuring robust risk management and sustainable returns for contributors.

She explained that the move is designed to address Nigeria’s infrastructure deficit, stimulate job creation and enhance productivity, while delivering inflation-hedged returns through investments in real assets.

“The objective is to build a market that works efficiently for the long term and ensures that pension assets contribute meaningfully to economic growth,” she said.

Oloworaran noted that the Council’s Investment and Financial Markets Committee will lead efforts to expand investment opportunities beyond traditional instruments, develop alternative asset classes and improve market liquidity.

She added that pension fund exposure to equities currently stands at approximately N4tn, representing roughly 3 to 4 per cent of total market capitalisation, indicating significant headroom for diversification.

The PenCom boss also emphasised the importance of de-risking infrastructure investments through partnerships with development finance institutions and the creation of well-structured, bankable project pipelines.

Beyond infrastructure financing, the Council is driving reforms across innovation, policy and stakeholder engagement. This includes accelerating digital transformation, strengthening cybersecurity frameworks and enhancing transparency across the pension industry.

Regarding financial inclusion, Oloworaran highlighted progress in expanding the Micro Pension Plan, particularly among informal sector participants, following nationwide sensitisation campaigns across Nigeria’s six geopolitical zones.

She expressed confidence that participation levels in 2026 would surpass the cumulative gains recorded since the scheme’s introduction in 2019, driven by increased awareness, incentives and the deployment of accredited pension agents.

The commission also pointed to recent policy advancements, including the streamlined processing of gratuity payments for federal government workers and significant increases in pension payouts under legacy schemes.

On compliance, PenCom stated it is intensifying enforcement against defaulting employers, with plans to collaborate with relevant agencies and publicly disclose defaulters to improve remittance rates.

Oloworaran stressed that the sustainability of pension returns is closely tied to the overall performance of the economy, underscoring the need for strategic investments that drive growth.

“The pension industry is no longer just about safeguarding funds. It is about driving economic expansion while ensuring that contributors and retirees benefit from stable and sustainable returns,” she said.

She concluded that the Pension Industry Leadership Council will continue to strengthen coordination, accountability and innovation, positioning the sector for its next phase of growth.