Pension payment to Embrace E-Payment

The payment of pension claims in Nigeria has over the years been shrouded in pains and agony. Many have died trying to collect their retirement benefits. Unfortunately the various efforts made in the past to redress this issue have snowballed in disappointment. However all that is about to change now, courtesy the outcome of a workshop which was organized recently to address the lapses. The event was the gathering of top pension professionals where about 70 senior pension industry executives from 25 Pension Fund Administrators and Custodians met to discuss and share experiences on e-Pension and e-Payment at a workshop held in Lagos. The strategic workshop tagged Remita e-Payment and e-Pension was organized by SystemSpecs for pension industry stakeholders to discuss among other things, the implications of the Central Bank of Nigeria Payment System Vision 2020 mandate on e-Payment as it relates to pension contribution remittances and retirees pension processing and payment. John Obaro, Managing Director SystemSpecs, in his speech reiterated the need for all stakeholders to continue to work together to achieve operational efficiency, optimize internal operations and empower employer organizations to meet e-Payment regulatory requirements while remitting her employees’ pension contributions.
Obaro enumerated that a true e-Payment solution should enable a user to achieve the following: view consolidated bank balances across multiple banks on a single screen, End-to-End processing of all payments electronically, conduct multi-bank activity from just one place, and replicate an existing payment workflow. He also added that Remita e-Pension provides additional capability for an employer to remit its employee pension contribution with appropriate schedules delivered to applicable Pension Administrators and Custodians electronically. Dr. Hakeem Bakare, Group Head, Corporate Strategy SystemSpecs stressed that “Remita Pension solution has the capability to deliver funds to the account of Pensions Administrators and matching schedule to relevant parties electronically. This will eliminate a major challenge confronting the pension industry in Nigeria” Some of the participants spoke of their impressions about the initiative. Dotun Adebayo, Head Contributions UBA Pension Fund Custodians said it was a “very good initiative, whose successful implementation will address core problems in the pension industry.”
Insurance Industry Premium Soars, Hits N200bn
If experts’ prediction that insurance would be a leader under the financial services regime is anything to go by, then there are indications that the premium earnings of the industry may greatly reposition the industry very shortly. According to statistics from the Nigerian Insurers Association (NIA), at its 39th Annual General Meeting (AGM)  held recently, the nation’s insurance industry has recorded a premium income of N200.6 billion for the financial year ended December 31, 2009, as against N150.3 billion which it achieved within the same period in 2008, indicating a 33.5 percent growth. Barrister Tobi Olagunju, while assessing the situation stated that the growth was largely necessitated by the various reforms and recapitalization which the industry embarked upon in the past four years.
He recalled that “soon after the capitalization the increased confidence in the industry led to enhanced investors confidence and the relative trust of the insuring public.” He added that the reforms led to a significant boost in the capital base of operators, a situation that has earned it a competing edge at least in Africa. Olagunju stated that but for the reforms, the investment drive which operators have extended to the African insurance market would have been impossible. He explained that the recapitalization raised the industry stake from less than N30 billion in 2005 to about N200 billion in 2007.
According to Wole Oshin while speaking at the meeting, the non life premium contribution to the premium base produced N161.4 billion while life business contributed 39.15 billion. He explained that motor business contributed the highest premium amounting to N41.67 billion as against N32.04 billion the previous year. This was followed by general accident insurance which contributed N30.98 billion followed by oil and gas business which generated N25.53 billion. On the other hand, marine and aviation came fourth in terms of premium generation, contributing N18.74 billion while fire business followed with a contribution of N17.3 billion.
Oshin added that that expectation of the NIA would be surpassed if insurance companies continue to evolve dynamic strategies to expand the frontiers of their businesses. He also extended his confidence to the new initiatives of the National Insurance Commission (NAICOM) in the area of product awareness and the Market Development and Restructuring Initiative (MDRI).