The National Pension Commission has released the ‘Guidelines on Foreign Currency Pension Contributions,’ allowing Pension Fund Administrators to invest part of the pension funds in foreign currency-denominated instruments.
This move is expected to expand access to the Contributory Pension Scheme for Nigerians earning in foreign currency, including those living abroad.
The guidelines also aim to provide a secure and transparent mechanism for making and managing foreign currency contributions, strengthen the investment potential of pension funds through diversified currency inflows, and ensure compliance with local regulatory requirements and international standards.
According to PenCom, Retirement Savings Account contributors living in the diaspora shall open a Non-Resident Nigerian Ordinary Account and remit pension contributions from their NRNOA to the foreign currency collection account of the PFA with the Pension Fund Custodian.
RSA contributors resident in Nigeria shall open Domiciliary Accounts with the collecting bank of the PFC appointed by the PFA and remit pension contributions from their DA to the foreign currency collection account of the PFA with the PFC.
The guidelines state, “PFAs shall invest foreign currency contributions within Nigeria in line with allowable investments set out by relevant provisions of the Regulation on Investment of Pension Fund Assets issued by the Commission; investments of foreign currency contributions shall be executed and retained in foreign currency.” PenCom also directed all PFAs and PFCs to report foreign currency pension contributions above $10,000 to the Nigeria Financial Intelligence Unit within 24 hours.
The pension fund has continued to grow, hitting N24.6 trillion by June 2025. Previously, only Closed Pension Fund Administrators were allowed to invest in foreign currency-denominated instruments, while PFAs were barred from it. However, the new guideline establishes the regulatory framework for Licensed Pension Fund Operators to accept, manage, and invest foreign currency contributions under the CPS.
