Understanding the Retirement Savings Account Transfer Process

Introduction

The National Pension Commission (PenCom) will commemorate the second anniversary of the rollout of the RSA Transfer, also known as the RSA Transfer Window, on November 16, 2022. The main goal of the RSA Transfer Window is to allow RSA holders the right to transfer their accounts from their existing Pension Fund Administrators (PFAs) to other PFAs of their choosing as provided by Section 13 of the Pension Reform Act (PRA) 2014, “an RSA holder may transfer his RSA from one PFA to another not more than once a year.”.

PenCom had developed and deployed the RSA Transfer System (RTS) to facilitate the RSA Transfer. The RTS is a computer-based application designed to initiate, process and monitor the RSA Transfer process. The RTS is automated, practical, free of charge, and transparent. Since the introduction of the RSA Transfer process, it has received accolades from RSA holders who yearn for improved service and better returns on their pension investments. Accordingly, PenCom has ensured that the requirements for initiating RSA transfers are minimal but with adequate regulatory oversight. 

Given the above, it is appropriate for RSA holders to know how to start an RSA Transfer.

Pre-requisite for the RSA Transfer

Before starting the RSA Transfer process, RSA holders must confirm that the PFAs managing their RSAs have migrated their personal details (biometrics and biodata) to the Enhanced Contributor Registration System (ECRS) platform. If the PFAs have not done that, then the RSA holder must participate in the Data Recapture Exercise (DRE), especially if the RSA holder registered before July 1, 2019. PenCom initiated the DRE to update RSA holders’ data, remove duplicate registrations and use the National Identity Number (NIN) as a unique identifier. Also, the DRE complies with the Federal Government’s order that all data-generating organisations must harmonise their databases with NIMC.

Process of RSA Transfer

RSA holders who opened their RSAs after July 1, 2019, are exempt from the DRE and may begin the RSA transfer process by contacting the PFA they want to transfer to (also known as Receiving PFA). The next step is to submit the following information; Surname, Current Phone Number, RSA PIN, and Email to the Receiving PFA. The Receiving PFA will request the RSA holders’ fingerprints and validate the fingerprints with the NIMC database to establish the identity of the person making the RSA transfer request. Once the Receiving PFA has satisfactorily established the person’s identity, it would print a confirmation slip, which the RSA holder would sign as evidence that their transfer request has been completed. The RSA holder is informed of the transfer request status through an email or an SMS to the address or phone number provided when the transfer request was initiated.

Subsequently, the current PFA (Transferring PFA) will transfer all the funds in the RSA to the Receiving PFA under the supervision of PenCom. After the RSA had been transferred, PenCom and the Receiving PFA will notify the RSA holder. Please note that RSA holders on Voluntary Contribution (VC) and Retirees on Programmed Withdrawal (PW) can also transfer their RSAs.

Transfer requests are batched and processed at the end of every quarter (March, June, September and December). However, only transfer requests received latest by the second month of a transfer quarter (February, May, August and November) are processed within the quarter. Accordingly, all transfer requests go through the RTS to the Transferring PFA, who must determine the value of the RSA and transfer it to the Receiving PFA at the end of the transfer quarter.

Upon completing the RSA transfer process, RSA holders should advise their employers of their new PFA for subsequent remittance of their monthly pension contributions. RSA holders should also contact their new PFAs to ensure that the RSA balances transferred by their former PFAs are accurate.

It should, however, be noted that the RSA Transfer process may be unsuccessful due to the following circumstances: the RSA holder has initiated a transfer request within the last 365 days; the data (biometrics and biodata) of the RSA holder have not been recaptured on the ECRS; the receiving PFA is not eligible to administer the RSA; and the verification of the RSA holder’s fingerprint/iris at NIMC fails.

Outlook

It is anticipated that RSA holders will continue to enjoy a smooth transfer of their RSAs to the PFAs of their choosing as PenCom marks the second anniversary of introducing the Transfer Window. The process has enhanced service delivery and promoted healthy competition among the PFAs. PenCom, Pension Operators, and other essential stakeholders in the pension industry deserve warm congratulations for this outstanding achievement.