Legacy Pension taps into informal sector to grow market share

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By Alex C

As part of efforts to grow its current share of the pension market, Legacy Pension Managers Limited, a Pension Fund Administrator (PFA), is advancing plans to veer into Nigeria’s huge under-tapped informal sector.

The move, which will leverage on a yet to be released guideline by the National Pension Commission (PenCom), will see the PFA explore effective strategies such as bond building with existing operators in the informal sector to enable it penetrate the market.

The pension managers, which has also paid over N20 billion in benefits in its eight years of existence, is also aiming to expand its information technology infrastructure to enable it boost its customer service delivery.

Disclosing this at the sidelines of its recent customer forum held in Lagos, Moustapha Muhammed, general manager, Legacy Pension Managers Limited, said that having seen a substantial growth on all fronts, against the backdrop of a consistent and focused management team, the firm was now set to grow its market footprint into the informal sector.

“Since inception, we have had a stable and credible management board and this is a huge advantage for us. Likewise, our huge investment in information technology infrastructure has helped us deepen our penetration into the market, and we are looking to expand these infrastructure for superior customer service delivery,” Muhammed said.

According to him, these strategies have been significant in the firm’s ability to grow its Assets Under Management (AUM) from N2.3 billion in 2006 to N150 billion as of October 2014. The company’s Retirement Savings Account (RSA) has surged from 82,293 in 2006 to 273,674, as of October 2014.

Despite these achievements, the general manager noted that the firm had had its fair share of challenges.

“One of our major challenges is that as the second generation of licenced PFAs we had to compete with the first movers who had already penetrated the market, we had to compete to get enrolment, and this demanded infrastructure, resources, logistics and capacity on our part,” he said.

On company’s future outlook, Muhammed was optimistic it was bright, saying, “we are determined to face it with all the necessary human and material resources that are needed for our success and growth, even as we aim to explore the potentials of the informal sector.”

The firm aims to achieve through its strategic process of identifying where the informal market is, what their needs are, enlightening operators on the need for the contributory pension scheme, he said.

According to him, the firm will also be looking to expand its existing IT infrastructure to enable it deepen penetration into the market as it aims to further distinguish itself with its superior customer service delivery.

“We will also establish more branches to help us get closer to the people and consequently the informal sector,” he said, adding that the firm was committed to its vision of becoming one of the top three PFAs in the near future.

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