India’s pension regulator PFRDA plans a major expansion of the National Pension System, targeting up to 400 million subscribers through digital enrolment and new market strategies over the next five years.
India’s pension regulator is aiming to turn the National Pension System into a far bigger savings vehicle, with a target of taking non-government subscribers from about 9 million to 350 million-400 million over the next five years, according to PFRDA chairman Sivasubramanian Ramann. Speaking at an outreach event in Kolkata, Ramann said the Pension Fund Regulatory and Development Authority wants to push the scheme beyond its traditional base of government and salaried workers and into the private sector, self-employed households and other non-government users.
The plan rests heavily on digital enrolment. According to the authority, online onboarding could add 20 million-30 million new subscribers a year if the system scales as expected. That would be a sharp change for a pension product long seen as paperwork-heavy and confined to formal employment. PFRDA is also leaning on existing financial distribution channels, including points of presence and their tied agents, to widen access.
One of the main tools in that effort is StAR NPS, a digital onboarding platform introduced by PFRDA to cut friction in enrolment and contribution processing. Livemint reported that the system connects points of presence, central recordkeeping agencies and the trustee bank, while allowing paperless registration, document verification and transaction handling. The platform is open to resident Indians aged 18 to 85, with a registration charge of ₹200 plus tax, and subscribers cannot be charged more than that for onboarding.
The regulator is also trying to bring mutual fund distributors into the pension market as pension agents, in the hope that they can use their existing customer relationships to expand NPS take-up. That push comes alongside a recent tweak to the commission structure for points of presence, which gives them a trail commission of 0.20% of assets under management a year plus the one-off onboarding fee. Even so, Livemint reported that some industry experts remain doubtful the economics are attractive enough to draw large numbers of distributors away from mutual funds.
PFRDA has also increased the number of pension fund managers under the scheme by approving four new entrants, taking the total to 14. The added choice is meant to make NPS more appealing to savers weighing long-term retirement options. Ramann said the scheme’s conservative plans have delivered annualised returns of 9.2% to 9.3% over the past 15 years, a figure PFRDA is using to reinforce the case for wider adoption.
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