ForumIAS announcing GS Foundation Program for UPSC CSE 2025-26 from 19 April. Click Here for more information.
ForumIAS Answer Writing Focus Group (AWFG) for Mains 2024 commencing from 24th June 2024. The Entrance Test for the program will be held on 28th April 2024 at 9 AM. To know more about the program visit: https://forumias.com/blog/awfg2024
News:According to the Pension Fund Regulatory and Development Authority (PFRDA),National Pension System (NPS) is a less-preferred saving option due to a certain mindset of individuals and corporates.
Facts:
- The PFRDA has said that there are around 7,000 corporates companies registered with PFRDA.However, only 2-4% of employees of these registered companies are covered under NPS.
- Further,the pension system also cover small number of individuals and corporates while a large population of small, medium, and micro enterprises and start-ups are yet to be part of the pension market.
- Hence,the central government is considering to double tax benefits to ₹1 lakh from ₹50,000.It may also allow PFRDA to become a single regulator for all pension products to give the entity more validity and standing in the country’s under tapped pension market.
About National Pension System(NPS):
- National Pension System (NPS) is a government-sponsored pension scheme.It was launched in January 2004 for government employees.However,in 2009,it was opened to all sections.
- Objective:The scheme allows subscribers to contribute regularly in a pension account during their working life.
- Upon retirement,subscribers can withdraw a part of the corpus in a lump sum and use the remaining corpus to buy an annuity to secure a regular income after retirement.
- Implementation:NPS is being implemented and regulated by Pension Fund Regulatory and Development Authority in the country.
- National Pension System Trust(NPST) established by PFRDA is the registered owner of all assets under NPS.
- Eligibility:Any individual citizen of India (both resident and Non-resident) in the age group of 18-65 years can join NPS.
- Recently,PFRDA has permitted Overseas Citizen of India(OCI) to enroll in the NPS at par with Non-Resident Indians.
Additional information:
About PFRDA:
- PFRDA is a statutory body established under the Pension Fund Regulatory Development Authority(PFRDA) Act,2013.
- Its objective is to be a model regulator for promotion and development of an organized pension system to serve the old age income needs of people on a sustainable basis.
- It develops, promotes and regulates the pension industry under National Pension System and also administers the Atal Pension Yojana.
