The Pension Reform Act 2004 established the National Pension Commission (PENCOM) as the body to regulate, supervise and ensure the effective administration of pension matters in Nigeria.
The objectives of the PENCOM are as follows;
- Regulation and supervision of the Scheme established under the Act.
- Issuance of guidelines for the investment of pension funds.
- Approving, licensing, regulating and supervising pension fund administrators, custodians and other institutions relating to pension matters as the Commission may, from time to time, determine.
- Establishing standards, rules and guidelines for the management of the pension funds under the Act.
- Ensuring the maintenance of a National Data Bank on all pension matters.
- Carrying out public awareness and education on the establishment and management of the Scheme.
- Promoting capacity building and institutional strengthening of pension fund administrators and custodians.
- Receiving and investigating complaints of impropriety levelled against any pension fund administrator, custodian or employer or any of their staff or agents.
The regulatory environment plays a pivotal role in the smooth operation of the financial sector and in the efficient management and integration of capital flows and domestic savings. The value of the claims of financial institutions on borrowers is dependent upon the certainty of legal rights, coupled with the predictability and speed of their fair and impartial enforcement.
To encourage online financial sector development, the regulatory environment should provide a framework that enables the development of sustainable markets, facilitates monitoring and enforcement of rules, and ensures investor protection. Accordingly, a well-functioning system combines a repertoire of up-to-date regulations backed by strong institutions with effective monitoring and enforcement mechanisms