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11
September 2017
 |
The
Pension Fund Regulatory and Development Authority (PFRDA) on Monday announced
that the upper age limit for joining the National Pension Scheme (NPS) had been
raised to 65 years, from the current 60.
Chairman
PFRDA Hemant Contractor made the announcement here at a conference on
"Transferring Superannuation Funds to National Pension System",
saying the pension regulator's board had already approved the change and it
would be notified shortly. The Total
Investment & Insurance Solutions
"NPS
is currently open for people between 18 and 60, and our Board has approved
raising the age limit for joining to 65," Contractor said.
"The
scheme anyway has the option of continuing and making contributions up to the
age of 70," he added. The Total
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Explaining
that the rationale behind government reforms in pensions is to facilitate
"portability", or the transfer of superannuation funds by making the
NPS more attractive and customer-friendly.
"The
aim is to open up pensions to sectors that are without pensions," he said,
noting that only 15-16 per cent of employees in India are covered by pensions
because an overwhelming 85 per cent of the workforce is found in the
unorganised, or "informal", sector.
Elaborating
on the benefits of the NPS, Contractor said it is the "lowest-cost pension
product in the world today".
"Costs
are important because even one per cent difference in cost over 25-30 years,
makes around 15-16 per cent difference at the end because of the compounding
factor." The Total Investment & Insurance
Solutions
"Our
fund management charges are a miniscule 0.01 per cent... the lowest, when you
compare others charging 0.4 or 0.5 per cent," he said, adding that the NPS
returns compare with the "best in the industry".The Total Investment & Insurance Solutions
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