By Kingsley Webora TANKEH
The CEO of the National Pensions Regulatory Authority, Christopher Boadi-Mensah, has urged fund managers to broaden their investment portfolios as a means to minimize risk and enhance returns for the sake of national progress.
“The proper administration of pension funds plays a crucial role in ensuring the well-being of our retired citizens and acts as long-term funding that can be directed towards construction, housing, renewable energy, and development initiatives,” he stated.
“These investments offer both reliable inflation protection and the potential to generate employment as well as enhance efficiency,” he highlighted.
As governments alongside numerous developing nations face changing population dynamics, increasing longevity, and a growing unofficial economy, discussions about investment strategies and pension management have become increasingly critical.
Given that approximately 80 percent of Ghana’s workforce operates within the informal sector and remains unregulated — implying they are not part of any structured pension system — Mr. Boadi-Mensah is advocating for expanding coverage so as to include these workers.
He stated that refusing these diligent citizens, who make considerable contributions to the national economy, any form of retirement security “is not merely a matter of public policy but also an issue of social equity.”
At The Money Summit 2025 organized by the Business and Financial Times in Accra, the official announced that they have created a micro-pension regulatory framework tailored to meet the requirements and habits of informal sector employees. This initiative aims to enhance inclusivity for pension funds within Ghana.
This structure supports daily, weekly, or monthly payments and caters to both long-term and annuity-style retirement choices.
Despite the informal sector presenting an enormous opportunity for fund managers to raise capital for investments, he stressed that integrating it into the pension landscape is not just about numbers. “It is about dignity,” he said, stressing the need for urgent action.
He said the authority is working with stakeholders to design incentive models for the informal sector workers. These include contribution-matching incentives and tax reliefs to encourage broader participation.
To improve accessibility, NPRA is leveraging technology to develop a responsive and reliable dedicated digital platform – the Pension Digital Ecosystem – that will make onboarding and benefit access seamless.
“By integrating it with mobile money platforms and the GhanaCard, contributions will receive real-time updates on their account,” he added.
According to his view, this degree of openness is crucial for expanding confidence in pension funds… forming the foundation for enduring dedication.
“Pension funds embody the diligently saved earnings of employees nationwide,” he pointed out.
By June 2024, the total value of managed pension funds amounted to GH¢78.2 billion. According to data from the PensionsDigest, approximately 78.34% of these assets were invested in government-backed securities issued by theGovernmentof Ghana (GoG), such asTreasurybills and bonds.
Addressing the topic of pension investment diversification, Mr. Boadi-Mensah emphasized the importance of managing their risk exposure to government securities and bonds, which may harbor unseen dangers.
After the exceptional 2022 Domestic Debt Exchange Program, DDEP – where GH₵61.7 billion was forfeited in anticipated interest payments and maturity extensions – alternative solutions have been suggested.
However, industry professionals are calling for a clear and practical structure that guarantees transparency so as to safeguard the investments of these susceptible pensioners and make them accessible whenever required.
The central topic of The Money Summit 2025 will be
–
‘Enhancing investment and pension management strategies: Approaches for secure retirement income and economic development’
— highlights the urgent necessity for comprehensive long-term financial strategies, especially during periods where economic instability could potentially deplete investors’ resources.
More intriguingly, the regulatory landscape has become somewhat more lenient. In 2023, the National Pensions Regulatory Authority (NPRA) increased the cap for alternative investments to 25 percent, only one year following the well-known DDEP incident.
Nevertheless, this appears insufficient according to industry professionals, given the excessive focus on government securities and bonds.
“We have to acknowledge that the conventional investment-class fund, which is mostly controlled by government securities, is approaching its peak. Meanwhile, savings like instrumental funds offer minimal returns, particularly during times marked by inflation, market volatility, and economic instability at the smaller scale,” he stated.
By their very nature, pension funds have a long-term outlook. Beyond conventional assets such as equities, fixed-income securities, and cash flows from operations, these funds can also be directed towards infrastructure projects, property investments, debt restructuring, venture capital, clean energy initiatives, water distribution networks, railway development, digital communications infrastructure, agribusiness, and affordable housing.
The diversification of pension fund investments offers chances to effectively handle long-term risks, all while ensuring that pension funds support national developmental goals.
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).