Abuja, Nigeria | Tuesday, September 16, 2025
Nigeria’s pension industry continues to exhibit a high level of concentration, with just five Pension Fund Administrators (PFAs) controlling almost half of total pension assets under management (AUM). According to latest data from the National Pension Commission (PenCom), the top five PFAs managed a combined ₦11.58 trillion as of August 2025, representing 47 percent of the industry’s total assets.
PenCom’s report revealed that overall pension assets stood at ₦24.65 trillion in August, reflecting steady growth driven by increased contributions, investment returns, and wider coverage under the Contributory Pension Scheme (CPS). However, the dominance of a few large PFAs has sparked renewed debate over competition, efficiency, and innovation in the sector.
Market watchers noted that while the concentration suggests strength and trust in the leading firms, it also raises concerns about limited choices for contributors and the risk of systemic shocks if any of the major PFAs face operational challenges. Smaller PFAs continue to struggle with attracting enrollees and competing for market share, despite regulatory efforts to ensure a level playing field.
Analysts believe the current structure mirrors trends in other emerging markets, where a handful of players dominate pension management due to strong financial backing, wider networks, and brand recognition. Still, they argue that more incentives may be needed to encourage innovation and improve service delivery across the industry.
The pension sector remains a critical component of Nigeria’s financial system, providing long-term funds for infrastructure development and capital market growth. With nearly ₦25 trillion under management, it stands as one of the country’s most stable sources of domestic investment financing.
