Kotak Pension Fund to focus on corporate model to drive growth

MUMBAI: Kotak Mahindra Pension Fund, which is one of the fund managers under the National Pension System (NPS), is focusing on corporate model of pensions to drive growth, a top company official said on Wednesday.

"We are focusing on corporate model of NPS to drive growth. We are in touch with many corporates for this and confident of increasing the business in the future," Kotak Mahindra PF chief executive Sandeep Shrikhande told reporters.

Under the NPS corporate model, an employee gets up to 10 per cent tax rebate on the contribution made by the employer. He also said the company is receiving encouraging response from corporates for joining NPS.

The NPS, introduced by in 2004, is considered as the lowest cost pension fund schemes in the country. Total assets under management (AUM) of the NPS stood at Rs 34,976 crore by end June, majority of which came from Central and state employees.

However, AUM under the corporate model stands at around Rs 1,500 crore, reflecting potential for higher growth. As per Kotak Mahindra Pension Fund, it manages around Rs 33 crore of pension fund as of now. "We hope to grow this number as more subscribers come under NPS-corporate model," Shrikhande said.

The NPS is regulated by Pension Fund Regulatory and Development Authority (Pfrda) and is open to every citizen.