Comments
Pension assets under management (AUM) have crossed the ₹5-lakh crore mark to touch ₹5.05-lakh crore now, PFRDA Chairman Supratim Bandyopadhyay said on Thursday.
“This is a small milestone we have achieved. We have to cross many such milestones before we can really provide old age security to people at large. Pension as a concept is still at a nascent stage in India,” Bandyopadhyay told a virtual press conference.
He also said that the overall AUM could touch close to ₹6-lakh crore by end March next year. For the current fiscal, Bandyopadhyay expects the AUM to continue clocking at least 30 per cent compounded growth as was seen in recent years.
Bandyopadhyay said there has been steady inflows into NPS across all segments including government, private corporates, retail. The returns generated over long period of time besides the income tax benefits has made NPS an “unbeatable” product.
PFRDA plans to rope in consultant for hiving off NPS Trust, structural rejig
On October 15 last year, the overall AUM stood at about ₹ 3,74,000 crore, which meant that AUM has grown 35 per cent year-on-year on this date.
Online onboarding
Bandyopadhyay also said that between March 31, 2020 (when AUM was ₹4.17 lakh crore) and now, the growth in AUM has been at 21 per cent despite challenges of Covid-19.
“We have simplified the process of online onboarding, made it user friendly and sitting at home they can do the onboarding digitally. We have also made Aadhaar as point of onboarding for banks. We are encouraging more retail and corporates to onboard to NPS. We are also encouraging the self employed to join NPS,” he said.
PFRDA Chairman also said that he expects 7-7.5 lakh new NPS subscribers (voluntary) will be onboarded this fiscal. “Already 2 lakhs have come during the last six months and we expect another 5 lakhs before end March,” he added.
Pension fund managers: ‘Floor’ and ‘cap’ concept to be introduced in RFP
As many as 45 Central Public Sector Enterprises (CPSEs) including biggies like Indian Oil Corporation and NTPC have shifted to NPS.
Atal Pension Yojana
In Atal Pension Yojana, where 3 million new subscribers were added during the pandemic period so far this fiscal, the aim is to take it to overall subscriber base to 30 million by end March 2021. “We know this looks ambitious. But the way flows are coming in last few months of August and September, we have seen lot of traction. Banks are helping us in a big way,” Bandyopadhyay said.
Asked about introduction of minimum assured return scheme in NPS, Bandyopadhyay said a committee will be formed and actuarial inputs will be taken for this purpose. PFRDA will finalise the product this financial year and sent to the Board for approval, he said.
CAG observation
On the recent CAG observation on NPS and absence of actuarial evaluation, Bandyopadhyay said that NPS is absolutely market based and does not guarantee any kind of return. So there is no need for any actuarial evaluation.
“Since we have not promised anything or guaranteed anything, the question of actuarial valuation does not arise. We are giving only market return to NPS subscribers and no actuarial valuation is needed there. When we introduce minimum assured return scheme, it will come under NPS and then we have to ensure actuarial valuation for this kind of product,” he said.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.