NPS- National Pension System launches new schemes: Deepak Mohanty, Chairperson-PFRDA

Chennai, June 14, 2024: Chairperson-PFRDA, Dr.Deepak Mohanty during the press meet outlined on the salient features and new schemes of NPS. Following are the points discussed during the meet.

Dr.Deepak Mohanty, Chairperson-PFRDA

Recent Milestones achieved by NPS / APY:

• 12 Lakh Cr. AUM on 14th May 2024. 
• AUM has increased from Rs 10 lac crore to Rs 12 lac crore in less than 9 months (24 August 2023 to 14th May 2024).
• Private Sector AUM reached 2.36 Lakh Cr. as on 18th May 2024.
• The number of subscribers under private sector has reached 56.1 Lakhs
• Share of Private Sector Subscribers in NPS has increased from 21.6% in Mar-19 to 37.5% in Mar-24.
• Share of Private Sector AUM in NPS has increased from 13.1% in Mar-19 to 20% in Mar-24.
• In FY 2023-24, 9.4 lakh subscribers have on-boarded under NPS.

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Press meet Youtube Video link 👇

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Subscriber-centric initiatives undertaken:

• DSP Pension Fund Managers Pvt Ltd has been registered as the 11th Pension fund; Certificate of commencement of business has been issued to the PF. 
• Systematic lump-sum withdrawal.
• Choice of multiple PFs for each Asset Class.
• 100% investment in Equity is allowed under Tier-II.
• NPS account under Corporate Sector Model would be auto continued at the age of 60 or superannuation age. 
• Annuity purchase can be deferred up to the age of 75 years. 
• NPS withdrawal form may be considered as Annuity proposal form for offering the immediate annuity product by ASPs.
• Launch of Balanced Life Cycle (BLC) Fund as an additional investment avenue with enhanced equity exposure under an LC fund.

Initiatives for a favorable NPS ecosystem:

• Industry body for pension advocacy like AMFI & Insurance Council comprising representatives of intermediaries in the NP architecture.
• Risk profiling of Schemes – Asset Classes managed by Pension Funds
• Rationalization of regulations/compliance reduction.

Pivotal role played by the Distribution channel –

• Registered PoPs - PSBs, Pvt Banks, RRBs, SFBs, NBFCs, Fintech Co.
• Spreads awareness about pensions, need for retirement planning and how NPS & APY ensures old age income security for citizens.
• Provides last mile connectivity – acts as an interface between subscriber and NPS architecture – on-boarding, servicing and counselling.
• Updates its clients on benefits of NPS/APY through routine communications and social media messaging.
• Reaches out  to the big corporates for increase employee participation
• Channelizes household savings into investment (pension planning) and enables creation of a pensioned society

Why subscribers are choosing NPS- 

• In the unorganized sector, with no formal pension arrangements, individuals doing retirement planning on their own.
• NPS provides a worthy alternative- It is a Regulated, professionally managed, Low cost, Transparent and Portable pension plan well suited for any individual planning to save and invest for his/ her old age income security.  
• Provides flexibility of contributions and multiple choices of Pension Funds and asset allocation to accumulate a decent retirement corpus.
• NPS has various tax incentives and has generated attractive and competitive returns by the PFs.
• Tier I- Mandatory, non-withdrawable pension account and Tier II- Withdrawable & Short-term investment account.

PFRDA’s steps towards capacity building and outreach 

• Broad basing the distribution network through- Points of Presence (PoP)- PSBs, Pvt Banks, RRBs, SFBs, NBFCs, Fintech Companies
• Incentivizing the distribution partners 
• PFRDA is part of National Centre for Financial Education (NCFE) 
• PFRDA takes NPS/APY awareness initiatives through:
• Tie-ups with trade bodies – FICCI, ICC, CII.
• Awareness session to Corporates
• Annuity Literacy Programme (ALP)
• Engagement o Retirement Planners (RP)
• Subscriber Awareness Programmes by CRAs.
• Trainings on NPS/APY through empanelled Training Agency
• Hosting of Pension Literacy Website – Pension Sanchay
• Social Media Campaigns – Facebook, Twitter, LinkedIn, YouTube.
• Advertisements through print/digital media, radio, TVC, etc.
• Observing ‘NPS Diwas’ on 1st Oct which is designated by UN as the International Day of Older Persons.

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