The largest pension fund manager (PFM) in the country, SBI Pension Funds is looking at achieving its assets under management to Rs 65,000 crore by the fiscal-end from the AUM at Rs 61,000 crore as on December 31, a top company official said.
"We are looking at achieving our assets under management to Rs 65,000 crore by the fiscal-end from the current AUM level of Rs 61,000 crore," SBI Pension Funds' newly-appointed managing director and chief executive Kumar Sharadindu told PTI here today.
At present, more than 25,000 branches of SBI group are selling the NPS products as point of presence. All the PoPs get Rs 125 for subscription of every NPS subscriber and hence it's a source of income for the bank too having its branches acting as PoPs.
"As of now, I'm encouraging the company's promoter State Bank of India to spread the message of National Pension Scheme for private sector people to join," he said adding, "SBI group has got a reach in rural and semi-urban areas, where there are lots of non-salaried people who are not in any formal employment anywhere and hence, small savings at their end can make their lives more comfortable on attaining the age of 60 years."
This shall align with government's objective of moving our country towards a stable pension society, he said.
There are seven PFMs in the country at present and the pension fund regulator PFRDA is likely to give its nod to few more PFMs to kick off their operations in the country in near future.
Commenting on it, Sharadindu said that larger the number of PFMs, better will be the reach of the NPS products. "We generally feel that the reach of NPS will get wider this way," he said.
Earlier, the management fee was based on whichever PFM
would quote the lowest fund management fee, which would then be applicable for all the PFMs. However, PFRDA has now changed the rule of the game. As per the existing system, the PFMs are charging fee at .01 per cent of the fund they manage under private sector.
It was sometime back that PFRDA came out with RFP, allowing players to decide fee of their own subject to cap of .1 per cent. This is still the lowest fee across the globe for any contributory fund.
"Once it happens, it could be low for some, while higher for other PFMs," he said.
Now, it is up to the subscribers to choose the fund manager based on fee structure apart from other performance parameters, he added.
The process towards this new approach has already started. However, it would be implemented once the PFRDA issues a notification in this direction.
With overall 38 per cent market share, SBI Pension Funds is the largest among all the seven existing PFMs in the country at present. "While 63 per cent of the private subscribers are with SBI Pension Funds, 35 per cent of the government sector subscribers are also there with us", he said.
