Fee hike for managers to add more NPS subscribers
Private and corporate sector is a huge segment for pension schemes because of the presence of a vast population below the age of 35, needing a long-term financial instrument to manage their retirement fund. “Around 350 corporate clients have joined our scheme. However, the number is still very low and we are making efforts to increase it significantly over the next few months,” said Agarwal.
At present, PFRDA has six fund managers under NPS for private sector and there are plans to increase the number significantly over the next few years.
With hike in fees for pension managers and increase in
number of distributors, the pension regulator is confident of finding more
private enterprises subscribing to the New Pension Scheme (NPS).
Yogesh Agarwal, chairman of Pension Fund Regulatory Development Authority (PFRDA), said, “Something (NPS) that was meant for public sector was simply extended to private sector and that is the reason it failed to pick up. However, with increased fees to 0.25 per cent, it becomes lot more viable for fund managers.”
Pension fund managers’ (PFMs’) fees was increased to 0.25 per cent, from an earlier 0.0009 per cent beginning November.
NPS is also expected to face a lot of competition from the insurance sector
that has started coming out with pension plans, although takers for them are
few. “NPS is definitely a better option against insurance or mutual funds for
pension because the costs are low,” added Agarwal. He spoke to reporters on the
sidelines of a conference on pension funds held by industry body, Assocham in
the capital on Tuesday.Yogesh Agarwal, chairman of Pension Fund Regulatory Development Authority (PFRDA), said, “Something (NPS) that was meant for public sector was simply extended to private sector and that is the reason it failed to pick up. However, with increased fees to 0.25 per cent, it becomes lot more viable for fund managers.”
Pension fund managers’ (PFMs’) fees was increased to 0.25 per cent, from an earlier 0.0009 per cent beginning November.
Private and corporate sector is a huge segment for pension schemes because of the presence of a vast population below the age of 35, needing a long-term financial instrument to manage their retirement fund. “Around 350 corporate clients have joined our scheme. However, the number is still very low and we are making efforts to increase it significantly over the next few months,” said Agarwal.
At present, PFRDA has six fund managers under NPS for private sector and there are plans to increase the number significantly over the next few years.
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