All You Need to Know About PFRDA

What is PFRDA?

The Pension Fund Regulatory and Development Authority, more commonly known as PFRDA, is the statutory regulator of the pension sector in India. It was established as an interim regulator on 23 August 2003 and became a statutory body under the PFRDA Act, 2013, which came into force on 1 February 2014.

PFRDA regulates the National Pension Scheme (NPS) and the Atal Pension Yojana (APY), safeguards subscribers' interests, and promotes the growth of India's pension sector. Its regulatory framework covers government employees, private-sector employees, self-employed individuals, NRIs, and other eligible subscribers under the applicable schemes.

Objectives of PFRDA

PFRDA works to regulate and develop India's pension sector while safeguarding the interests of subscribers. Its key objectives include:

• Regulate Pension Schemes: Oversees the National Pension System (NPS), Atal Pension Yojana (APY), and other pension schemes under its regulatory framework.

• Develop the Pension Sector: Promotes the growth, stability, and efficiency of the pension ecosystem through policies and regulatory guidelines.

• Protect Subscribers' Interests: Ensures that pension subscribers' rights, benefits, and retirement savings are protected through a transparent regulatory framework.

• Regulate Pension Intermediaries: Registers, supervises, and monitors intermediaries such as Pension Fund Managers (PFMs), Central Recordkeeping Agencies (CRAs), Point of Presence (PoPs), Trustee Bank, and Custodian.

• Frame Rules and Standards: Issues regulations, operational guidelines, and compliance standards for pension funds and intermediaries.

• Grievance Redressal: Establishes mechanisms for resolving subscriber complaints and improving service quality across the pension system.

• Promote Pension Awareness: Encourages retirement planning by creating awareness about pension schemes and educating citizens on long-term financial security.

Functions of PFRDA

Headquartered in New Delhi, here are some critical functions related to the Pension Fund Regulatory and Development Authority (PFRDA):

• To protect pension fund subscribers' interests

• Promote, regulate, and develop the pension sector.

• Tier I and Tier II accounts under the National Pension Scheme (NPS) are regulated by PFRDA.

• To promote pension awareness and support the development of the pension sector.

• PFRDA helps in educating the citizens about the importance of pensions in old age

• Addresses any grievances related to pension schemes

• Resolves disputes between various intermediaries

• Train and inform intermediaries about the pension schemes and their functioning

Intermediaries of PFRDA

The PFRDA appoints different intermediaries to carry out various purposes like:

• Collection

• Organisation

• Distribution

• Management

• Record-keeping

The following are the intermediaries of the Pension Fund Regulatory and Development Authority (PFRDA):

1. Central Recordkeeping Agency (CRA)

   Central Recordkeeping Agency (CRA), as the name suggests, is an agency under PFRDA that maintains accounting, record-keeping, administration, and customer service of the National Pension Scheme. Three Central Recordkeeping Agencies (CRAs) appointed by PFRDA are:

   • Protean eGov Technologies Limited (formerly NSDL e-Governance Infrastructure Limited)

   • KFin Technologies Limited (formerly Karvy Computershare Private Limited)

   • Computer Age Management Services Limited (CAMS)

   CRA Applicability

   • The employer can choose from any of the three CRAs in the case of private sector employee pension subscribers.

   • Any of the CRAs can be opted for by non-employee voluntary subscribers.

   • Any of the CRAs can be opted for by the aggregator for National Pension Scheme subscribers.

   • Government can choose from any of the three CRAs in the case of government sector employee pension subscribers, and Atal Pension Yojana subscribers can now also select any of the three.

   Functions of CRA

   • CRA keeps all the records and administers all the customers registered under the NPS (National Pension Scheme).

   • They are responsible for issuing PRAN (Permanent Retirement Account Number) to all the NPS customers.

   • CRA manages contributions made by PRAN subscribers and updates intermediaries about the same.

   • Periodically updates the PRAN records and also offers a grievance management system.

2. Pension Fund

   Another intermediary of PFRDA (Pension Fund Regulatory and Development Authority), pension funds have been granted the authority of collection, organization, etc., like all the other intermediaries.

   Functions of Pension Fund

   • Invests subscribers' pension contributions in accordance with PFRDA investment guidelines.

   • Offers a risk management committee

   • Maintains pension fund scheme records

   • Pension fund manager periodically updates and reports to the PFRDA.

   • Declaring NAV (Net Asset Value) to PFRDA

3. Point of Presence

   PoP is another important public-facing entity under the PFRDA that connects with the CRA electronically and works for:

   • Receiving

   • Transmitting

   • Payouts of the funds.

   Functions of Point of Presence

   • Analyses the KYC Documents of the NPS scheme holders.

   • Collects and verifies contributions by the NPS holders in various forms, such as cash, DD (Demand Drafts), cheques, etc.

   • Uploading of contributions received on the CRA System

   • Applying deductions and collection of application fees from the NPS scheme holders

   • Maintaining records for all the transactions under the scheme

   • Handling grievances and requests of the contributors

4. Trustee Bank

   Responsible for the everyday flow of funds, trustee banks are also intermediaries of PFRDA. PFRDA appoints a Trustee Bank to manage the flow of funds under the National Pension Scheme (NPS).

   Functions of Trustee Bank

   • Receiving contributions from Points of Presence (PoPs), Nodal Offices, and other authorised entities.

   • Verifying the details

   • They transfer funds correctly.

   • Trustee Bank maintains fund receipt information

   • Reconciling daily balance sheets with CRA

5. Custodian

   The custodian performs the following functions:

   • Keeping the assets or securities safely that are held under the NPS

   • Collection of benefits on these assets

   • Acts as a domestic depository

   • The Custodians are well-informed about any action taken by the issuer of securities.

   • Reconciles and maintains all the records

6. Nodal Office

   To make the NPS scheme reach the masses, nodal offices play an important and vital part. Central and State Government nodal offices connect with the CRA on the customer's behalf to carry out various purposes of the NPS. Central Government performs this function on a larger level, whereas the State Government is comparatively at a lower level.

7. Aggregators

   Aggregators act as the primary point of contact between eligible subscribers and the NPS, where applicable.

   • The aggregator is responsible for making any changes in the KYC documents of the contributors if and when required.

   • They also handle complaints in case the subscriber has any grievances.

Online Services Offered by PFRDA

Pension Fund Regulatory and Development Authority helps its customers and simplifies the process of pension scheme investment.

The following are the online services offered by the PFRDA that make life after retirement easier:

• One can open an NPS account online easily.

• Contributions towards the PRAN can be made online through the NPS platform and authorised channels.

• Tier II accounts can be activated online.

• Changes in the basic information related to the contributor can be made online.

• Any changes to be made in investment strategies.

• Transactions done can easily be tracked.

• Withdrawal requests can be processed.

• Any complaints or grievances can be filed online.

• e-PRAN or any other relevant document related to the pension scheme can be accessed easily.

PFRDA Contact Details

Pension Fund Regulatory and Development Authority (PFRDA) provides multiple channels for subscribers to seek information, resolve grievances, or get assistance related to the National Pension System (NPS) and other pension-related services. Subscribers can contact PFRDA through its official website, helpline numbers, or the NPS Information Desk.

Official Website: www.pfrda.org.in

Phone: 011-40717900

NPS Toll-Free Helpline: 1800 110 708

SMS Support: Send NPS to 56677

Key Takeaways

PFRDA is the statutory regulator responsible for overseeing the pension sector in India. It regulates the National Pension Scheme (NPS) and the Atal Pension Yojana (APY) while protecting the interests of subscribers. Established as an interim regulator in 2003 and later granted statutory status under the PFRDA Act, 2013, it also regulates pension intermediaries, promotes pension plan awareness, and offers various online NPS services.

FAQs

1. What is PFRDA?

   PFRDA (Pension Fund Regulatory and Development Authority) is the statutory body that regulates and develops the pension sector in India. It also protects the interests of pension subscribers.

2. Which pension schemes are regulated by PFRDA?

   PFRDA regulates the National Pension Scheme (NPS) and the Atal Pension Yojana (APY).

3. What are the main functions of PFRDA?

   PFRDA regulates pension funds and intermediaries, safeguards subscribers' interests, promotes pension awareness, and oversees the functioning of the NPS and APY.

4. Can I access PFRDA services online?

   Yes. You can access several NPS-related services online, including account opening, contributions, profile updates, withdrawal requests, and grievance registration through authorised platforms.