 "NPS Vatsalya growing, onboards 75,000 people since launch: PFRDA chairman")
The National Pension Scheme (NPS) is trying to make itself accessible to individuals of all ages and its recently-launched NPS Vatsalya, for minors to secure their future, is making good progress as it has on boarded 75,000 people since its launch in September this year, Pension Fund Regulatory and Development Authority (PFRDA) Chairman Deepak Mohanty said on Saturday.
Finance Minister Nirmala Sitharaman had in September launched NPS Vatsalya, which is based on the principle of intergenerational equity by providing cover to older and young members of the family.
“NPS has emerged as a very flexible and user-friendly pension scheme and is easily accessible…. It is accessible to people starting from age 0 to 70. The government launched the NPS Vatsalya. I used to tell them that we love our children more than ourselves. So, definitely parents may not have NPS for themselves, but they will get it for their children and the number is making good progress. It has been a few months and we got about 75,000 people onboard NPS Vatsalya,” said Mohanty during the launch of Association of NPS Intermediaries.
Currently, NPS and Atal Pension Yojana together have a total customer base of over 8 crore people, while the Assets Under Management (AUM) of the NPS stands at around Rs 14 lakh crore, which is contributing towards national progress in terms of long-term investment. The AUM is expected to rise to Rs 15 lakh crore by the end of the current financial year 2024-2025 (FY25).
“Though, there is volatility in the market, but the market in general is upwards and given that situation, our expectation is that by the end of the year, it (AUM) should be Rs 15 lakh crore,” Mohanty said.
Meanwhile, Chief Executive Officer (CEO) of Axis Bank, Amitabh Chaudhry, also highlighted the growing need for securing a reliable income after retirement amid the demographic shift where there is a growing number of working professionals who are moving away from the traditional forms of family support systems.
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He also highlighted certain reforms that the sector can undertake, including unifying the pension products under a single regulator and investment regime, helping the customer to make informed choices. Chaudhry also said that the salaried class should be given an option to choose between EPFO and NPS.
“Lastly, the mandatory annuity purchase at exit remains a deterrent for many, discouraging them from opting for NPS. I think the chairman also referred to that to some extent. The PFRDA has already launched and implemented the systematic lump-sum withdrawal process, which has proven quite efficient,” he said.
Chaudhry also said that this association (of intermediaries) hopefully will help in fostering trust, clearing droughts, and providing necessary support to subscribers throughout their NPS journey, and also ensuring that they are working with the regulator in providing the right feedback to ensure that the whole industry continues to move forward.
The Association of NPS Intermediaries is a collective platform representing all stakeholders in the NPS ecosystem. It is committed to enhancing the effectiveness of the system, strengthening subscriber welfare, and collaborating with policymakers to shape the future of retirement planning in India.
The ANI stakeholders are points of presence (bank and non-bank), central record keeping agencies, trustee banks, custodians, aggregators, annuity service providers, pension agents, retirement advisors, and other industry participants.