The IDBI Mutual Fund has firmed up plans to launch the country's first-ever pension scheme. This forms a part of the package of three schemes lined up by the fund "" the others being one tailor-made scheme and the other a scheme with investments in the money market.
The pension scheme assumes prominence because this is the first time any domestic mutual fund scheme will enter the area of pension funds. Pension funds are very popular in the US market and some of the larger players like Fidelity specialise in pension schemes.
Senior IDBI Mutual officials told Business Standard that a detailed plan for each of these three schemes have already been submitted to the Securities and Exchange Board of India (Sebi) and are awaiting a final clearance.
Explaining the structure of the pension scheme, a senior AMC official said the scheme will be structured in four different categories. Investors subscribing to the scheme will have the option for investing for periods of 7, 14, 21 and 30 years.
We are targeting investors beyond the age-group of 25 years. Investors, once they retire, will be getting a fixed percentage as interest in every month for a specific period ranging between 15 and 20 years. After this period, the investors will be asked to take away their deposits, the official explained. The investments of this scheme will be primarily in debt as these instruments provide regular returns.
Another first in this scheme will be the introduction of interval fund concept in the Indian capital market.
The scheme structured as a closed-ended scheme will be open for subscription during certain times of the year.