What does Pension Fund Regulatory and Development Authority (PFRDA) do?

PFRDA is the statutory regulator of the pension sector in India.
It regulates and develops pension systems to ensure old-age income security.

Legal Basis

• PFRDA Act, 2013
• Became a statutory body in 2014
• Headquarters: New Delhi

Objectives of PFRDA

• Regulate pension funds
• Protect subscribers’ interests
• Promote pension coverage, especially in the unorganised sector
• Ensure transparency and efficiency in pension systems

Functions of PFRDA

Regulates:

• National Pension System (NPS)
• Atal Pension Yojana (APY)

Registers and regulates:

• Pension Fund Managers (PFMs)
• Central Record Keeping Agencies (CRAs)
• Custodians, Trustees

Issues guidelines on:

• Investment norms
• Risk management
• Subscriber protection
• Promotes financial literacy related to pensions

Pension Schemes under PFRDA

1. National Pension System (NPS)

• Started: 2004 (for govt employees)
• Open to all citizens (since 2009)
• Defined Contribution Scheme
• Market-linked returns
• Two tiers:
• Tier I – Mandatory, retirement account
• Tier II – Voluntary, savings account

Atal Pension Yojana (APY)

• Launched: 2015
• For unorganised sector workers
• Guaranteed pension:
• ₹1,000 to ₹5,000 per month
• Government co-contribution (for eligible subscribers)

Structure of PFRDA

• Chairperson
• 3 Whole-time Members
• 3 Part-time Members
• Appointed by Central Government

Investment Regulation

Pension funds invest in:

• Government securities
• Corporate bonds
• Equity (limited exposure)
• Ensures:
  • Safety
  • Diversification
  • Long-term returns