Pension Regulatory and Development Authority (PFRDA) was launched by the Government of India in 2003 under the PFRDA Act 2013. This scheme was launched with a view to promote, regulate and expand the industry of India. PFRDA extends its services to all Indian nationals, NRI’s, and self employed persons. But initially it was limited only to the government employees. PFRDA has its headquarters located in New Delhi and regional offices spread all over the country.
PFRDA Act 2013
To develop a final and full-proof system, the Parliament of India passed Interim Pension Fund Regulatory & Development Authority (IPRDA) in 2003 with the approval of all the political parties, including the opposition parties. Finally, the President of India established Pension Regulatory and Development Authority (PFRDA) on September 19, 2003. This Authority has now become fully autonomous with effect from Financial Year 2014-15 and functions independently. The President was the guardian of PFRDA till 2014-15.
Functions of PFRDA
- The primary goal of PFRDA is to promote old age income security. This is being done through creation and regulation of pension funds, safeguarding the interests of people associated with pension fund schemes, growing of pension funds and ascertaining the issues associated with it.
- PFRDA helps to promote and encourage obligatory and voluntary pension schemes in order to meet the income demands of workers on their retirement.
- PFRDA is responsible for overseeing and governing both Tier 1 and Tier 2 of National Pension System.
- PFRDA hires different intermediaries like Central Record Keeping Agency, Pension Fund Managers to manage its operations.
- PFRDA also highlights and brings awareness among the general public and stakeholders on the importance of pensions.
- PFRDA also imparts training to intermediaries who are responsible to popularise and teach the value and importance of pensions to individuals in the society.
- PFRDA also address and solve the issues occurring among intermediaries such as banks, consumers and intermediates.
Intermediaries under PFRDA
PFRDA has appointed various intermediaries to help an organization deal with the collection, management, keeping records and distribution of money. Here are some of intermediaries that are appointed by PFRDA. These are as follows:
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Central Record Keeping Agency (CRA):
- This intermediary is responsible for accounting, record keeping, administration and providing customer support and guidance to pension fund holders. PFRDA has appointed two Central Record Keeping Agencies for this purpose. These are National Securities Depository Limited (NDSL) and Karvy Computershare Private Limited (KCPL).
- The employers of the private sector employees who subscribed to pension have the option of choosing between the two CRA’s.
- Non employee voluntary subscribers have the option to select from the two CRA’s on their own.
- The Government also has the option of choosing CRA for government employees who have subscribed to pension and the ones enrolled in Atal Pension Yojana.
- The aggregator helps to choose from the two CRA’s for the NPS subscribers.
CRA also functions as an intermediary between PFRDA and the public and here are the following functions of CRA as a mediator:
- CRA helps in assisting all the intermediaries as operational interface and carries out activities, maintains records and administers the information of clients that are registered in pension funds.
- CRA also issues PRAN cards, handles the maintenance of PRAN database and keeps track and record of subscriber transactions.
- It also makes ensure that all the contributions made by the subscribers to the Pension Fund are fully utilized.
- CRA gathers the information from various subscribers and transmits it to intermediaries such as the trustee Bank.
- CRA ensures the distribution of units to the subscribers and also helps in monitoring, supervision and settlement of money invested.
- It provides various kinds of services to its subscribers such as centralized grievance management system, customer call centers, withdrawal requests, etc.
Online Services of PFRDA
The various steps have been taken by Pension Regulatory and Development Authority to make it feasible for people to invest in pension funds, both online and offline. Availability of internet services helps to encourage consumers to have several retirement funds. Some of them are listed below:
- Opening of Pension Fund Account through National Pension Scheme (NPS).
- Contributions to PRAN Account, this does not include NPS- Swavalamban and Atal Pension Yojana Accounts.
- Activating Account for Tier 2.
- Making changes in the personal information of subscribers.
- Making changes in investment strategy.
- Downloading and accessing the transaction statements.
- changing of pension arrangements.
- Processing the requests of departure or withdrawal.
- Printing of e-PRAN and other documents.
- Filing of the complaint.