Salt to software giant Tata Group and Max Financial Services have decided to foray into the country's pension sector by setting up seprate companies as “Pension Fund Manager'' (PFM), part of National Pension Scheme (NPS),which is regulated by Delhi based PFRDA(Pension Fund Regulatory and Development Authority).
Tata Group has applied for a PFM license from PFRDA through its mutual fund arm Tata Asset Management(Tata AMC) while Max Financial Services has done so through its life insurance subsidiary Max Life Insurance.
Currently, NPS has seven palyers including State Bank of India, ICICI Bank, Kotak, UTI and Life Insurance Corporation. HDFC and AB group.
Confirming the development Supratim Bandyopadhyay, chairman, PFRDA said,“Yes , we have received applications from Tata AMC and Max life who want be PFMs.We are processing them.''
Bandyopadhyay said Axis bank also wants to set up a PFM and is waiting for approvals from Reserve Bank of india (RBI) which may be completed in next 15 days.
“We had recently opened our on-tap window asking for applications from prospective players and we had received two bidders. The on-tap window is closed now and is likely to open next year. We are now talking to a few other prospective players to encourage them to enter the sector,'' he said.
So far, NPS has seen a 60% jump in NPS onboarding in the first six months of this financial year and returns (in CAGR) by PFMs is more than 10% over a period of 12 years.
The total corpus of NPS has grown to Rs 6.67 trillion and the total number of subscribers is 4.60 crores as on 25th September, 2021, he said.
In pension sector, the foreign direct investment(FDI limit has already been raised to 74 per cent. This is in line with the FDI rules in the domestic insurance sector, said Bandyopadhyay.
PFRDA has also decided to allow insurnace agents to be part of Point of Presence to sell pension products.
“We have formed a panel to consider to raise commision level for PoPs currently participated by banks, non- banking finance companies and fintechs,'' added Bandyopadhyay.
The (PFRDA) along with all its registered intermediaries across the country observed National Pension System Diwas (NPS Diwas) today. This campaign was dedicated towards ‘Azadi Ka Amrit Mahotsav’ celebrations and to encourage citizens to join NPS for achieving financial freedom upon retirement through pension as a regular income.
As a mark of their contribution towards this eventful day, State Bank of India enabled NPS enrollments in their YONO Mobile App and Kotak Mahindra Bank likewise in their Mobile Banking App.