Business Economy


PFRDA sets up expert panel to frame assured payout structure under NPS

New Delhi, Jan 13 (UNI) The Pension Fund Regulatory and Development Authority (PFRDA) has constituted a high-level expert committee to design a regulatory framework for assured payouts under the National Pension System (NPS), a move aimed at strengthening retirement income security for subscribers, an official statement said on Tuesday.
The committee has been tasked with developing guidelines that will enable predictable and assured pension payouts when subscribers move from the accumulation phase to the withdrawal phase.
This initiative is seen as a significant step towards improving post-retirement financial certainty while retaining the core market-linked structure of the NPS.
The 15-member panel will be chaired by Dr MS Sahoo, former chairperson of the Insolvency and Bankruptcy Board of India, and comprises experts from diverse fields including finance, law, insurance, actuarial science, capital markets and academia.
The committee may also invite additional subject-matter specialists as needed to support its work.
As part of its mandate, the panel will examine various mechanisms to ensure assured payouts, including the use of market-based solutions and legal constructs such as novation and settlement. It will also propose operational norms covering lock-in periods, withdrawal options, pricing structures and fee mechanisms applicable under the assured payout model.
The committee will review risk management and capital adequacy requirements to safeguard subscriber interests while maintaining financial stability within the pension ecosystem. It will also assess tax implications to ensure that assured payout structures can be implemented without compelling subscribers to exit the NPS framework.
Another key focus area will be consumer protection. The panel is expected to recommend standardised disclosure norms to enhance transparency, reduce mis-selling risks and clearly communicate the nature and extent of payout assurances to subscribers.
The move comes amid growing policy focus on retirement preparedness as India’s subscriber base under NPS continues to expand. Currently, NPS payouts are largely market-linked, exposing retirees to fluctuations in financial markets. The proposed assured payout framework aims to address this gap by offering greater income predictability in retirement.
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