Pension Fund Regulatory and Development Authority (PFRDA)
Chatrapati Shivaji Bhawan
B-14/A, Qutab Institutional Area
New Delhi – 110016
PREAMBLE AND INTRODUCTION Invitation for expression of interest from leading Actuarial firms for designing and development of a Minimum Assured Return Scheme as contemplated under Sec 20 of PFRDA Act, 2013
INTRODUCTION: Pension Fund Regulatory and Development Authority,
initially created vide the resolution of the Government of India, dated
10.10.03 (then Interim PFRDA). With effect from 01.02.14, i.e. the date
of notification of the PFRDA Act, 2013, the Authority has been
established under Section 3 of the said Act. As per Section 12 of the
PFRDA Act, 2013, the mandate of PFRDA is to regulate the National
Pension System (NPS) and any other pension schemes, not governed by any
other enactment.
Though originally conceived as a contributory pension scheme for central government
employees, replacing the erstwhile defined benefit scheme w.e.f
01.01.04, now NPS caters to all the citizens of India, from the year
2009. Further employees of majority state governments are also
subscribed to NPS, besides employees of Central Autonomous bodies and
State Autonomous Bodies as also certain Corporates in the private
sector. The major difference between the government subscribers and
other subscribers viz. all citizens is that all citizens are not
entitled to any contribution of 10% of salary which is available to
employees of government and corporates. Normally upon entry into the
system, the subscriber remains invested till his age of superannuation
or 60 years, where after upon exit from the system, he is entitled to
withdraw up to 60% of the accumulations and the balance 40% is
mandatorily required to purchase annuity from an annuity service
provider, who will provide the monthly pension to the subscriber.
The project requires developing the scheme and processes for
implementation based on the actuarial principles, similar products/
schemes/practices in operation (or otherwise) both in India and abroad
and in consultation with concerned stakeholders like pension funds,
Central record keeping Agency and other market participants who have
similar schemes or have experience in dealing with such schemes.
With reference to the Minimum Assured Returns scheme, PFRDA Act, 2013
provides for the following and the design of the product shall confirm
to these provisions:
Sec 20 (2) (d) (b) the subscriber, seeking minimum assured returns,
shall have an option to invest his funds in such schemes providing
minimum assured returns as may be notified by the Authority;
Sec 20 (2) (g) there shall not be any implicit or explicit
assurance of benefits except market based guarantee mechanism to be
purchased by the subscriber;
Pension Fund Regulatory and Development Authority (PFRDA) is a
statutory body, which operates within the legal framework of Pension
Fund Regulatory and Development Authority Act 2013. Its statutory
objectives are: a. Protection of interests of subscribers b. Promotion and development of the pension sector c. Regulation and supervision of National Pension System and matters incidental thereto
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