Farley And Partners

Benefits Under The National Provident Fund

For most members their concern is when and how to access their contributions. It is important to note that the savings in the National Provident Fund are for retirement purpose above other considerations. However apart from the normal retirement, there are contingencies that allow members to get part if not all their money.

At retirement a claimant receives a lump-sum made up of :

  • the 10% contribution of the employer
  • the 5% contribution made from your salary
  • plus a very generous interest rate based on the average rate on investments

Under the National Provident Fund, all the benefits are paid in one off mode, so that there is nothing like a regular pension. However at the request of the claimant part of the lump sum may be converted into an annuity, receivable periodically.

After retirement, ones earning capacity is reduced. Therefore, the advice is to wisely invest your money to guarantee a sustained income during retirement.


To qualify for the withdrawal benefit under subsection 29(4) of SSHFC Act, a member must prove to the Managing Director that

  • he/she has attained the age of 45 years
  • he/she has been out of employment for at least two years

The whole account its payable in this type of benefit and the account would be closed.


The Withdrawal Benefit is payable to a member who proves t the Managing Director that :

  • he/she has attained the age of 45 years
  • Is not in employment

Members who have not attained the normal retirement age of 60 but wish to prematurely retire from work can do so at the age of 45 or thereafter. However there is a cooling off period which depends on the age of the member at the time of retiring.

For those withdrawing between the age of 45 and 54, 6 months cooling off period must be observed; and for those aged 55 and above, 3 months cooling off period is required provided that such retirees did not receive any benefits previously. This benefit is not payable to a member who leaves one employer for another.

The cooling off period begins from the date of submission of claim.

The withdrawal benefits is paid as follows:


Age Percentage of accrual payable
45 – 54 70%
55 – 59 85%


The balance in the members’ accounts shall be payable on normal retirement or when entitlement is established under the other contingencies, subject to qualifying conditions relating to those contingencies.

The resumption of employment before the expiry of the cooling off period shall terminate entitlement to benefit.

Members who prematurely retire can re-join the scheme if they are nor more than 59 years of age.

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