The Pension Fund Regulatory and Development Authority (PFRDA) is expected to provide a scheme with minimum assured returns to subscribers as an choice beneath the National Pension System (NPS). The regulator has now invited bids from consultants to formulate/style in consultations with stakeholders a minimum assured return scheme that can be provided to the current and potential subscribers by Pension Funds.
As per the PFRDA document inviting proposals from consultants, the guarantees beneath the proposed minimum assured returns scheme may possibly be based on the following parameters:
- Capital plus further rewards or Interest Rate Guarantee.
- Applicable on every single contribution individually.
- Funds received by means of a switch from other schemes may possibly be viewed as as fresh contributions.
- Guarantee may possibly be applicable only to future contributions (prospectively).
- All contributions will be eligible for the assure topic to specific monetary limits
- Guarantee may possibly be based on Nominal return with preferences for Interest Rate assure
- Combinations of fixed or floating prices may possibly be worked out for MARS
- Lock-in may possibly be applicable on every single contribution and applied based on the period considering the fact that that contribution.
- Multiple lock-in period selections (or have staggered assure periods) may possibly be viewed as for flexibility.
- Withdrawals may possibly be straight linked to the lock-in period. The subscriber may possibly have the choice to withdraw or to keep invested right after the lock-in period, having said that, there will not be any assure applied on the investment right after lock-in.
- Minimum and maximum monetary limits on contributions may possibly be prescribed.
- Pension Funds may possibly be permitted to charge charges as a percentage of corpus managed by them
NPS is based on a exclusive person pension account viz. Permanent Retirement Account Number (PRAN) made for every single person subscriber. A citizen of India aged involving 18-70 years can join NPS either in their person capacity or in association with their Employer.
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Contributions to the Individual Pension Account can be made through one’s working life. This can be completed either by the person or employer or by the employer and employee with each other in equal or unequal proportion. The accumulated corpus beneath the scheme is utilized to procure a pension upon retirement/superannuation of the subscriber.