Pension scheme roll-out for unorganised sector likely: PFRDA

MUMBAI: The Pension Fund Regulatory and Development Authority (PFRDA), is planning to implement a pension fund scheme roll-out for employees in the unorganised sector in the next five to six months, a top official said.

The PFRDA is presently in the process of finalising an institutional advisor to advice it on the issue, he added.
"We are in the process of appointing an institutional advisor to advice us on the matter," PFRDA's CEO, N R Rayalu, told reporters on the sidelines of a conference here today.

"We expect the recommendations from this advisor in another two to three months this will help PFRDA to roll-out the scheme for the unorganised sector within a period of six months," Rayalu said.

This move is expected to benefit millions in the unorganised sector by enabling them to access the benefits of the pension scheme.

PFRDA has floated tenders for advisors and is understood to have already received a few applications. Once the roll-out for the unorganised sector is completed, the regulator may look at inviting applications from private players for participation in the pension fund sector, he said.

This move, if it fructifies, is expected to enhance competition in the segment. "We are actively looking at inviting private players as fund managers," Rayalu said. Presently, three state-owned entities--State Bank of India, Life Insurance Corporation of India and UTI AMC have been given approval by PFRDA to act as fund managers.

21 states in the country are in the process of joining the pension scheme by end-this year, Rayalu said, adding that the PFRDA has till now received a corpus of Rs 1,500 crore.

Rayalu also said that the beneficiaries of the scheme are free to switch over to another fund manager at the end of each year.