More banks line up to offer NPS
Even though subscribers are not really rushing in droves to it, intermediaries wanting to sell the New Pension System are increasing. Known as points of presence, some of the largest banks, including Punjab National Bank and Syndicate Bank, are keen to sell NPS. Sandeep Singh reports.india Updated: Jun 24, 2009 23:11 IST
Even though subscribers are not really rushing in droves to it, intermediaries wanting to sell the New Pension System (NPS) are increasing. Known as points of presence (POP), some of the largest banks, including Punjab National Bank and Syndicate Bank, are keen to sell NPS.
“I am getting request from more people to join us as points of presence,” said D Swarup, chairman, Pension Fund Regulatory and Development Authority (PFRDA). “We have got inquiries from both public and private sector banks to join us as POPs.”
Increasing the number of POP would help sell a retirement planning scheme that’s arguably the world’s cheapest. “We will consider them because we have an open system and it will expand our medium of presence,” said Swarup.
While PFRDA is looking to expand its reach and medium, it is also exploring ways to make the scheme more attractive to subscribers. For instance, it is considering to offer withdrawals for selective purpose from the contribution made by its subscribers into the NPS, once PFRDA is given a statutory status by Parliament.
“As of now the government’s advice is ‘no withdrawals’ and I am contemplating to offer it only when the act gets passed,” Swarup said. “We will allow withdrawals only for the first house purchase and not for the second house and also allow it for terminal or critical illness.”
As of now, neither government employees nor subscribers in the unorganised sector are allowed to withdraw their contribution.
The scheme, launched on May 1 for the unorganised sector, is likely to get government support as it plans to bear the administrative cost for all subscribers as it does for its own employees.