PFRDA has set an ambitious target to increase non-government NPS subscribers from 90 lakh to 35-40 crore in five years, as announced by PFRDA Chairman Sivasubramanian Ramann at an outreach event in Kolkata on Friday. According to Zee News, the regulator expects the growing use of digital technology in the pension sector to help add around 2-3 crore subscribers to the system every year. The target would require NPS to move well beyond its traditional base of salaried and government-linked subscribers and reach a much larger pool of private-sector workers, self-employed individuals and other non-government subscribers. The proposed expansion would require NPS to significantly widen its reach beyond its traditional base of salaried employees and government-linked subscribers, with the regulator looking to bring a much larger number of private-sector workers, self-employed individuals and other non-government subscribers into the pension ecosystem. As per Zee News, PFRDA wants to replicate the scale achieved by the Atal Pension Yojana (APY), which has crossed 10 crore subscribers with the help of banks and regional rural banks, demonstrating that such ambitious targets are achievable through strategic distribution partnerships.
The Pension Fund Regulatory and Development Authority has approved four new pension funds, bringing the total count to 14, according to reports from The Economic Times. Pension funds collect and invest money contributed by employees and employers to build a large financial pool with an endeavour to pay regular income streams to workers after they retire. Subscribers to the National Pension Scheme (NPS) can choose any of the pension funds to invest in, with NPS aimed at ensuring long-term financial security for workers both in organised and unorganised sectors. As per Zee News, PFRDA Chairman Ramann confirmed these new fund approvals during the Kolkata outreach event, with the expansion of pension fund options coming as the regulator seeks to make NPS more attractive to a wider investor base, giving subscribers greater choice over how their retirement savings are managed. These new funds are expected to become active within two to three months.
PFRDA is building comprehensive digital infrastructure to simplify subscriber onboarding and improve last-mile access. According to Mint, the regulator is developing StAR NPS with BSE Technologies to enhance digital capabilities. The StAR NPS platform enables technology-enabled assisted onboarding through Points of Presence and their associated pension agents, including mutual fund distributors. The platform is designed to connect the onboarding process with Central Recordkeeping Agencies and the Trustee Bank, while supporting digital verification and other processes. The direct settlement mechanism eliminates fund pooling and manual reconciliation at the PoP level, improving operational efficiency while ensuring transparency, security and a better subscriber experience. BSE Index Services MD and CEO Ashutosh Singh highlighted that they have overhauled Star MF into MF 2.0, cutting client authentication from three OTPs to just one and simplifying UCC and FATCA compliance through bulk upload, bringing the same philosophy into StAR NPS to make client and agent onboarding simple and scheme selection intuitive. As per Zee News, PFRDA believes such technology-enabled processes can make NPS easier to access and allow the scheme to leverage existing financial distribution networks.
PFRDA is actively inviting mutual fund distributors to join StAR NPS by leveraging their existing familiarity with BSE StAR MF platforms. According to Mint, the move could give mutual fund distributors a larger role in pension distribution, with PFRDA encouraging them to act as pension agents and use their existing customer networks to bring more people into the NPS ecosystem. In a June circular, the regulator said the platform would facilitate technology-enabled assisted onboarding through Points of Presence and their associated pension agents, including mutual fund distributors. Ramann highlighted that mutual funds currently have an average holding period of 2.5 years, while NPS requires a 15-year commitment to see optimal growth. He emphasised that the regulatory body is advising mutual fund distributors to bring their customers into NPS as well, leveraging the trusted distribution networks to achieve subscriber growth targets. BSE's Singh noted that retirement planning in this country cannot wait until 55 or even 45, it should begin at 30 or earlier, and every mutual fund distributor in this room has the opportunity to become a retirement planning advisor too. As per Zee News, mutual fund distributors could consequently play a bigger role in expanding NPS coverage, with PFRDA encouraging distributors to become pension agents and use their existing customer base to increase awareness and participation in the retirement savings scheme.
According to Mint, Ramann highlighted that their conservative schemes have delivered 9.2-9.3% annual returns over 15 years. He referenced the success of Atal Pension Yojana, which has shown scale is achievable with 10 crore people joining through bank and RRB networks. Ramann expressed confidence that NPS can now build on that same distribution strength through digital onboarding, leveraging technology and trusted distribution networks to achieve the subscriber growth targets. The PFRDA organised an outreach event for mutual fund distributors in Kolkata to promote StAR NPS adoption, with plans to continue similar outreach programmes across the country to deepen pension penetration and improve retirement coverage through technology-enabled initiatives. The regulator is effectively betting that easier access, more distribution points and technology-led onboarding can make retirement planning a mainstream financial product rather than something people start considering only close to retirement.
