Experts Advocate Incentives For SMEs In Micro-Pension, Insurance Plans

Stakeholders have advocated the fusion of attractive incentives in the deployment of micro pension and micro insurance plans to Small and Medium Enterprises(SMEs) in the country.

The experts, who spoke on ‘On-boarding MSMEs into Micro Insurance and Pension Space in Nigeria,’ at the 7th Annual Conference of the Nigerian

Association of Insurance and Pension Editors (NAIPE) in Lagos, at the weekend, stressed that, this is critical for operators of both insurance and pension sectors to penetrate the informal sector.

On her part, the director general/CEO, Lagos Chamber of Commerce and Industry (LCCI), Dr. Chinyere Almona, said, although, the insurance and pension sectors have been doing a lot in driving financial inclusion initiative of the federal government, there is need to incentivise and encourage those in the informal sector, the Nigerian Nano, Micro, Small and Medium and Enterprises (NMSMEs) operators to embrace micro insurance and join the micro pension plan.

While calling on underwriters and pension administrators to take advantage of numerous opportunities that abound in the NMSME sector, Dr Almona said this critical market presents huge opportunity for the micro insurance and pension industry due to the size of the workforce.

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Other opportunities she listed included: large MSMEs employment/labour force, large willing adult population, expanding distribution channels, favourable regulatory environment, mature financial services sector and revolution in information technology and digital innovations.

Saying the total number of employment by MSMEs stood at 61.9 million representing 87.9 per cent of the total labour force in the country, she added added that, the number of employment generated by the informal sector was 16 million while the formal sector generated 7.5 million in 2020.

On the need to step up awareness and enlightenment of the NMSMEs on the benefits of micro insurance and micro pension and application of technology, Dr Almona said “investment in enlightenment campaigns and enabling technology are required.”

The benefits, according to her, included; a safety net at retirement, alignment with the current social empowerment programmes, minimizes old-age poverty and improves standard of living for the elderly

While calling on the National Insurance Commission (NAICOM) and the National Pension Commission (PenCom) to provide necessary regulatory framework that supports NMSMEs, said stated that, “with regulatory support, Nigeria is well placed to achieve meaningful micro-pension coverage rapidly as well as enhance insurance penetration.”

Earlier in her keynote address, the director-general, PenCom, Mrs Aisha Dahir-Umar, who was represented at the occasion by the head, South West Office of PenCom, Dr Tunde Alayande, stated that, the on-boarding of SMEs into the micro pension scheme is one of the strategies in which the pension industry has been contributing to the financial inclusion initiative of the federal government

He said the micro pension plan was designed for those in the informal sector, including the SMEs, disclosing that PenCom, in collaboration with the Pension Operators Association of Nigeria (PenOp), has come up with lots of initiatives to benefit SMEs through the scheme.

In his goodwill message, the chairman, NIA, Mr. Segun Omosehin commended NAIPE for the conference., noting that, the conference is not only significant to the insurance industry but also to the entire financial services indust

In her welcome address, the chairman of NAIPE, Mrs Nkechi Naeche Esezobor had said, the theme of the conference; ‘Onboarding MSMEs into Micro Insurance and Pension Space in Nigeria,’ was considered because of the importance of SMEs as driver and engine of growth of the Nigerian economy and the need to support it for the growth of the economy.