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In a bid to further enhance the ease of doing business and reduce compliance, the Pension Fund Regulatory and Development Authority (PFRDA) notified amendments made in the National Pension System (NPS) Trust Regulations and the Pension Fund Regulations on Wednesday.
The latest amendments in the NPS Trust Regulations simplify the provisions related to the appointment of trustees, their terms and conditions, the holding of meetings of the board of trustees, and the appointment of chief executive officers.
Meanwhile, the amendments to the Pension Fund Regulations simplify the provisions related to the governance of pension funds in line with the Companies Act, 2013, and enhance disclosure by pension funds.
Other amendments include clarity of the roles of the sponsor of the pension fund, inclusion of the name ‘pension fund’ in the name clause, and the requirement for existing pension fund(s) to comply with these provisions within 12 months.
Additionally, the pension fund has to constitute additional board committees, such as an audit committee and a nomination and remuneration committee.
The NPS Trust, established by the PFRDA to manage assets and funds under NPS, serves as the registered owner of all assets under the NPS architecture. However, subscribers remain the beneficial owners of the securities, assets, and funds under NPS.
Earlier last month, the financial sector regulator also notified that banks and non-banks can now act as points of presence to onboard NPS subscribers, requiring only a single registration for NPS, instead of multiple registrations. The timeline for disposing of applications was also reduced from 60 days to 30 days, and banks can operate with just one branch with a wider digital presence.
These amendments aim to simplify and reduce compliance in the financial sector and align with the announcement made by Finance Minister Nirmala Sitharaman in the Union Budget 2023-24 to review regulations, reducing the cost of compliance and enhancing the ease of doing business.
“To simplify, ease, and reduce the cost of compliance, financial sector regulators will be requested to carry out a comprehensive review of existing regulations,” Sitharaman said in her Budget speech.
