PFRDA Introduced NPS-Lite

Pension Fund Regulatory and Development Authority (PFRDA), the apex body established by Government of India to regulate and develop the pension sector, introduced NPS-Lite on 22 July 2010.  NPS-Lite targets the economically disadvantageous sections of society and promotes small savings during their productive life. It aims at building up a fund sufficient enough to buy an annuity for their old age. PFRDA had earlier extended New Pension System (NPS) to all citizens of India with effect from 1 May 2009. “Swavalamban Scheme” of Govt. of India, which grants an incentive of Rs.1000 to all eligible NPS accounts would be available to all NPS-Lite account holders as well. “NPS-Lite Model” was designed to ensure ultra-low administrative and transactional costs for making such small investments viable. NPS-Lite works on a “group” model and shall be available through “Aggregators” appointed by PFRDA. It also aims at harnessing the outreach and capacity of the Government operated schemes, NGOs, MFIs, NBFCs etc. in targeting and servicing the old age savings needs of low income worker.