New Delhi, Jan 1 || The Pension Fund Regulatory and Development Authority's (PFRDA) board has approved a framework to permit Scheduled Commercial Banks (SCBs) to independently set up Pension Funds to manage NPS, with the objective of strengthening the pension ecosystem, it was announced on Thursday.
This will enhance competition and safeguard subscriber’s interests.
The proposed framework seeks to address existing regulatory constraints that had limited bank participation till now, said Ministry of Finance in a statement.
By introducing a clearly defined eligibility criteria based on net worth, market capitalisation and prudential soundness in line with RBI norms, it will ensure that only well-capitalised and systemically robust banks are permitted to sponsor Pension Funds.
“The detailed criteria will be notified separately and will apply to both new and existing Pension Funds,” the statement said.
PFRDA has appointed three new Trustees on the Board of NPS Trust, pursuant to the selection process initiated by PFRDA.