PFRDA ISSUES REVISED SET OF GUIDELINES FOR
REGISTRATION OF PENSION FUND MANAGERS TO MANAGE NATIONAL PENSION SYSTEM FOR THE
NON-GOVERNMENT AND PRIVATE SECTOR
The Pension Fund Regulatory and Development
Authority (PFRDA) today issued a revised set of guidelines for registration of
Pension Fund Managers (PFMs) to manage the National Pension System (NPS) for
the non-government and private sector.
The revised guidelines, available on PFRDA’s
website www.pfrda.org.in, have done away with the earlier bidding process,
wherein a pre-determined number of slots were bid for by the PFMs, and the fees
charged by them for managing the pension funds had to be uniform for all
players. The earlier process has now been replaced by a system which lays down
the eligibility criteria for registration as PFMs, and all interested players
desiring to enter the pension industry, can register as PFMs subject to their
fulfilling the eligibility criteria. There is no limitation on the number of
PFMs. Further, the PFMs are now allowed to prescribe their own fee charges,
subject to an overall ceiling to be laid down by PFRDA. It is expected that
this would provide for an economically viable business model for the PFMs
attracting a fresh set of entrants into the pension industry, and the resultant
competition would ensure market driven fee structures, which would work to the
advantage of the pension subscribers.
The PFMs would also be expected to market the
National Pension System (NPS) to the potential subscribers, deciding their own
marketing and distribution channels as per their business perceptions.
It may be recalled that the NPS has not
achieved any significant progress in the private sector, despite passage of
considerable time, and these guidelines have been awaited by the industry for
quite some time. The changes are as per the recommendations of the Bajpai
Committee, set up by PFRDA to go into the reasons for the slow progress of NPS
in the private sector. The final guidelines have been issued subsequent to
intensive discussions with all stakeholders, including existing and potential
Pension Fund Managers as also suggestions received from pension subscribers.
Press Information Bureau Government of India
Ministry of Finance 12-July-2012 18:10 IST
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