New Delhi, Jul 8 (PTI) PFRDA Chairman Supratim Bandyopadhyay on Wednesday said on-boarding of private corporate subscribers under its flagship National Pension System (NPS) scheme remains low but good traction is seen from central public sector enterprises.

The pension fund regulator is also awaiting an amendment to the PFRDA Act which could push auto-enrolment of employees in the MSME sector in a big way to grow the pension outreach in the country.

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"Currently almost 7,800 corporates are there with us. The challenging part is that corporates are coming, but the take-up rate as to the number of employees who are joining, remains very-very low.

"It's between 2-2.5 per cent and, maximum in some places, it may go up to 8-10 per cent, not beyond that," Bandyopadhyay said at a webinar on 'Understanding The Impact of Pandemic on Retirement Benefits Planning' jointly organised by industry body FICCI and PFRDA.

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As the NPS subscription is mandatory in the central public sector enterprises (CPSEs), there is a good off-take especially in oil sector enterprises such as BPCL, HPCL, Indian Oil Corporation, ONGC, and Oil India Ltd, said the Pension Fund Regulatory and Development Authority (PFRDA) chairman said. "This year itself, more than 200 corporates have joined NPS in the first quarter itself. The challenges remain that after on-boarding what steps you have to take to ensure that more and more employees join-in. It remains a voluntary segment for many of the corporates," he added.

He also pointed out that going forward more number of people will be above 60 years of age and they would require a regular income to live their post-retirement life.

Now the post-retirement life is becoming longer by as much as up to 18-20 years due to better medical facilities and improved mortality rates.

Even as some claim to be cutting down on their post-retirement expenses, Bandyopadhyay said that does not really happens.

Rather people end up spending more towards their medical bills and there is no planning that really can be done (to avoid expenses), he stressed.

The PFRDA seeks to increase its outreach for auto-enrolment in a big way for the Micro, Small and Medium Enterprises (MSME), he said, adding it is awaiting amendment to the PFRDA Act on auto-enrolment of employees under the NPS.

"We are thinking, especially in the MSME sector, how can we really go for an auto-enrolment. So once the Act is amended, we will think about going for auto enrolment in a big way in the MSME sector," he added.

Auto enrolment also referred as 'soft compulsion' is a means to increase the coverage under private pension system with an option to the subscriber to opt-out.

Talking about numbers for the first quarter for NPS, both for corporate and individual voluntary segment, he said PFRDA has seen a steady growth in its Asset Under Management (AUM) under the corporate sector with little over Rs 47,000 crore corpus (as on June 30, 2020).

"Apart from that we have done OTP based on-boarding. We have also allowed the Overseas Citizens of India to join (NPS), we have even allowed the Indian nationals working at the foreign embassies,"Bandyopadhyay said. PTI

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)