Pension Bulletin. Volume VI Issue II. Pension Fund Regulatory and Development Authority

Transcription

1 Pension Bulletin Volume VI Issue II Pension Fund Regulatory and Development Authority Chhatrapati Shivaji Bhawan, B-14/A,Qutab Institutional Area, Katwaria Sarai, New Delhi-1100

2 Table of Contents Page No. Section 1: Transfer of amount from recognized Provident Fund/Superannuation fund to National Pension System...2 Section 2: NPS Statistics... 7 i. Sector wise growth... 7 ii. Overall Status of State Governments iii. UoS Sector (All citizens) in NPS iv. Total amount of subscribers contribution under UoS (Tier-I & Tier II): v. Total amount of AUM under UoS (Tier-I & Tier II)... vi. Total number of corporate, subscriber, contribution & AUM registered in Corporate Sector: vii. Status of APY: viii. PFM wise Total Assets on NPS schemes ix. PFM wise Return on NPS Schemes x. Performance of NPS Schemes of Central Government & State Government Employees. 21 xi. Performance of NPS schemes for Unorganized/Private Sector Section 3: Circulars/Notices/Guidelines Issued/Advisory Section 4: Workshops /Press Release/Conference conducted Section 5: Macro-Economic Statistics

3 Section 1: Transfer of amount from recognized Provident Fund/Superannuation fund to National Pension System Indian workforce employed in organized sector is covered under the following funded pension arrangements. i) mandatory pension scheme of Employees' Provident Fund Organization of India, ii) iii) Approved Superannuation Funds by the corporates, National Pension System. i) Scheme by Employees Provident Fund Organisation: The Employees Provident Funds and Miscellaneous Provisions Act, 1952 (EPF Act) is the major social security legislation in India aimed at, inter alia, securing retirement benefits for employees. Currently, three schemes operate under the EPF Act: Employees Provident Fund Scheme (EPFS), Employees Pension Scheme (EPS) and Employees Deposit Linked Insurance Scheme (EDLIS). Broadly speaking, the EPF Act applies to the following entities: Every establishment which is a factory engaged in any industry specified by the central government and in which 20 or more persons are employed; Any other establishment employing 20 or more persons which the central government may, by notification, specify in this behalf. An employee whose salary is greater than INR15,000 per month and who is not currently a member of the EPF scheme may be excluded from the provisions of the EPF Act. This clause of salarybased exclusion does not apply to International Workers and employees working in newspaper establishments. ii) iii) Superannuation Funds Superannuation Fund (SAF) is an employer-sponsored voluntary pension plan to facilitate pensions for employees when they retire/leave the organisation. SAF can be either a defined contribution or a defined benefit scheme, depending upon the option selected by the employer. An employer may create a SAF through a Trust, by executing a Trust Deed and have the same approved by the income-tax authorities. The Superannuation trust funds could be managed internally or through an insurance service provider which is approved by the Insurance Regulatory and Development Authority. Data on the number of SAFs in India is not consolidated; accordingly, the number of participants and the total corpus is unavailable. Due to insufficient data, it is difficult to establish the coverage and effectiveness of this pension instrument. National Pension System: The Government of India (GOI) rolled out the NPS initially for government employees other than armed forces, joining service from 1 st January 2004 which was later extended to all citizens of India from May 1, 2009 and Corporate sector from December,

4 Under NPS, two types of account are available to subscribers i.e. Tier I & Tier II; Tier I account is a pension account - where subscribers contribute his / her savings (may include employers contribution in case of Corporate sector) for retirement into a partially withdrawable account, and a Tier II account - a voluntary savings account from which subscribers are free to withdraw their savings whenever he wishes. The facility of Tier II account was made available from December 01, 2009 to All Citizens of India including Govt. employees and Corporate sector subscribers not mandatorily covered under NPS. An active Tier I account is a pre requisite for opening of a Tier II. A subscriber can open an NPS account through their DDA/PAO or through the online platform enpsor through with any one of POPs (Point Of Presence) and get a PRAN. Subscribers can choose their own investment option and pension fund. Subscribers can operate their account from anywhere in the country, even if they change the city, job or their pension fund manager. NPS is regulated by PFRDA, with transparent investment norms and regular monitoring and performance review of fund managers by NPS Trust. A summarised comparison of NPS, approved Superannuation fund and Employees Provident has been provided below. Comparison between EPF, Superannuation Fund and NPS Particulars National System (NPS) Pension Approved Superannuation Fund (ASAF) Employees Provident Fund Limit of contribution by Employee for tax purpose 10% of Basic + DA Subject to Maximum of Rs Lacs Additional tax deduction available on contribution upto Rs /- (Exclusive for NPS) Subject to Maximum of Rs Lacs Employee contribution is eligible for deduction from employees taxable income up to INR 150,000* Employer's Contribution to the Fund for tax purpose 10% of Basic + DA (No Monetary Limit) Not Taxable up to Rs. 1,50,000 per annum per employee. Above Rs. 1.5 lac, it is treated as perquisites Employer contribution up to 12 per cent of defined salary not included in employees taxable income. 3

5 in the hand of employee and taxed accordingly. Amount to be utilised for purchase of Annuity Minimum 40% of the accumulated corpus. However, subscriber can utilise higher corpus also. Limit on Lump sum withdrawal. Rest to be utilised for annuity payment. Monthly member pension under EPS at retirement or permanent disability. Lump Withdrawal sum Maximum 60% of the corpus 40% of the corpus is tax exempt from F.Y /3 rd of the Corpus can be withdrawn in lump sum in case Gratuity is paid ½ of the corpus can be withdrawn in case gratuity is not paid. Lump sum withdrawal at resignation, retirement or death. Requirement for operationalization of scheme by the Corporates Registration with CRA by providing some basic information. Formation of an Irrevocable Trust and appointment of Trustees Opening of Trust Account Decision on the fund management technique, i.e., selfmanaged or insurer managed. Registration of the establishment with EPFO. Income Approval Tax Not required Required from concerned Income Tax Authority Not required 4

6 Investment Subscribers may choose their own investments from three asset classes i.e. corporate bonds, government securities and equity. The investment in equity is capped at 50 per cent. One can also opt for life cycle funds which have pre-determined investment pattern. The trustees of SAF invest the funds as per the norms laid down by Ministry of Finance, Government of India. The accumulations are invested by the board of trustees of EPF, as per the norms laid down by Ministry of Labour and Employment, Government of India. In the Union Budget 20-17, one time portability without any tax implication has been allowed to the subscriber for shifting from recognized provident funds and superannuation funds to National pension System. With the implementation of the above proposals from this Financial Year and the tax benefits available under NPS, NPS has become very attractive to the subscribers. NPS now provides the seamless facility to the subscribers of Superannuation Scheme and Provident Fund scheme to shift to NPS without any tax implication. In this context, PFRDA has come out with a circular on transfer of amount from recognized Provident Fund/Superannuation fund to National Pension System (PFRDA/2017/11/PD/3 dated 6 th March 2017). In case the subscriber is interested to get his recognized provident fund/superannuation fund transferred to NPS, he may follow the below mentioned process: The subscriber should have an active NPS Tier I account which can be opened either through the employer (where NPS is implemented) by filling up the prescribed subscriber registration form or through the Points of Presence (POPs) (Banks/non-banks entities registered as POPs with PFRDA) or online through enps on the NPS Trust website. The subscriber presently under Govt./Private sector employment is required to approach the recognized provident fund/superannuation Fund Trust through the current employer by giving request for transfer of his recognized provident fund/ superannuation fund to his NPS account. The recognized Provident Fund/Superannuation Fund Trust may initiate transfer of the Fund as per the provisions of the TRUST Deed read with the provisions of the Income Tax Act, The Recognised Provident Fund/Superannuation Fund may issue the cheque/draft in the name of Nodal Office with employee name and PRAN FOR Govt. employees and in the name of 5

7 POP Collection Account-NPS Trust with the subscribers name and PRAN for the private sector including All Citizen Model. In case of Government employees, the employee should request the recognized provident fund/superannuation Fund to issue a letter to his present employer mentioning that the amount is being transferred from the recognized provident fund/ superannuation fund to be credited in the NPS Tier I account of the employee. The present employer/pop i.e. nodal office shall while uploading the fund may mention the transfer from recognized provident fund/superannuation fund in the remarks column while uploading it through arrears mode. The upload may be made as per the request letter of the ex-employer. In case of private sector employee including subscriber covered under All Citizen Model, the employee should request the recognized provident fund/superannuation fund to issue a letter to his present employer/pop as the case may be mentioning that amount is being transferred from the recognized provident fund/ superannuation fund to be credited in the NPS account of the employee/individual Tier I account. As per provisions of the Income Tax Act, 1961 the amount so transferred from the recognized provident fund/ Superannuation fund to NPS is not treated as income of the current year and hence not taxable. Further, the transferred recognized provident fund/superannuation fund will not be treated as contribution of the current year by employee/employer and accordingly the subscriber would not make IT claim of contribution for his transferred amount. *** 6

8 Section 2: NPS Statistics i. Sector wise growth a) The number of subscribers under NPS and APY increased from Rs lakhs as at the end of January, 2017 to Rs lakhs as end of February, 2017 i.e. by 2.19 % growth supported by a growth of 5.34 % in APY and % in unorganized sector. During the current financial year i.e. April - February 2017, the number of subscribers has increased from lakhs to lakhs, registering a growth of %. The maximum growth is witnessed in APY, in which the number of subscriber increased from lakhs as at the end of March 20 to 44. lakhs as at the end of February 2017, registering a growth of %. UoS/All citizen subscribers have increased by 70.23% during the first 11 months of the current financial year and Corporate Sector subscribers have increased by % during the same period. Table No: 1. Number of Subscriber (in lakhs) Year/Month Schemes Number of Subscribers (in lakhs) Mar-12 Mar-13 Mar-14 Mar-15 Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb-17 A. CG B. SG Govt. sec Total (A+B) Govt. sec % growth C. Corporate Sector D. All Citizen (Corp+All Citizen) Sec Total (C+D) (Corp+All Citizen) Sec % growth E. NPS Lite/ Swavalamban F. APY Subtotal (NPS lite+apy) (E+F) (NPS lite+apy) % growth Grand Total (A+B+C+D+E+F)

9 in lakh Y-o-Y % growth Chart No: 1. Number of Subscriber (in lakh) Number of subscriber (in lakhs) Mar-12 Mar-13 Mar-14 Mar-15 Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb CG SG Corporate Sector All Citizen NPS Lite/ Swavalamban APY Total YoY % of Growth Of the total subscribers, government sector subscribers are 32 % of the total subscriber, each APY and NPS Lite constitute 30% of the subscriber and Corporate and All Citizen subscribers constitute 4 % and 2% respectively of the total subscriber. Chart No: 2. % share of subscriber as on 25 th Feb, 2017 APY 30% CG 12% SG 22% NPA Lite 30% All Citizen 2% Corporate Sector 4% 8

10 b) The contribution under NPS has increased from Rs crores as at the end of January, 2017 to Rs crores as at the end of February, 2017 i.e. by 2.56 %. During April - Feb 2017, the contributions received from subscribers have increased from Rs crores to Rs crores, i.e. a growth of %. The maximum growth in contribution has been witnessed in APY ( %), followed by All Citizen ( %) and Corporate sector (44.80 %). Table No: 2. Total Contribution (Rs. In crores) Year/Month Schemes Mar-12 Mar- 14 Total Contribution (Rs. In crores ) Mar- 15 Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb-17 A. CG B. SG Govt. sec Total (A+B) Govt. sec % growth C. Corporate Sector D. All Citizen (Corp+All Citizen) Sec Total (C+D) (Corp+All Citizen) Sec % growth E. NPS Lite/ Swavalamban F. APY Subtotal (NPS lite+apy) (E+F) (NPS lite+apy) % growth Grand Total (A+B+C+D+E+F)

11 Rs in crores Y-o-Y % of growth Chart No: 3. Total Contribution (Rs. In crore) Mar-12 Mar-13 Mar-14 Mar-15 Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb-17 CG SG Corporate Sector All Citizen NPS Lite/ Swavalamban APY Total YoY % of Growth 0.00 Contribution by the government subscribers constitute 86 % of the total contribution in NPS followed by contribution of 9 % of corporate subscribers and 2 % each by NPS-Lite and All Citizen subscribers. Chart No: 4. % share of contribution in NPS as on 25 th Feb, 2017 Corporate Sector 9% All Citizen 2% NPS Lite 2% APY 1% CG 36% SG 50% 10

12 c) The AUM under NPS have increased from Rs. 6,847crore as end of January, 2017 to Rs. 7,178 crore as at the end of February, 2017 i.e. by 0.20 % during the month of February During April Feb 2017 of the current Financial Year, the AUM under NPS & APY has increased from Rs. 118,810 crores to Rs. 7,178 crore i.e. by %. The year over year (Feb 2017 over Feb 20) growth in AUM of NPS & APY combined has been 50.06%. During the month of February 2017, the highest growth in AUM in percentage terms is witnessed in unorganized sector which is 9.99 % followed by increase of 4.85% in APY. AUM under APY has more than tripled during April - February 2017, from Rs. 506 crores as end of March 20 to Rs crores as end of February, 2017 i.e. by %. Table No: 3. AUM (Rs.in crores) Year/Month Schemes Mar- 12 Mar- 13 Mar- 14 Mar- 15 AUM (Rs. In crore ) Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb-17 A. CG B. SG Govt. sec total (A+B) Y-o-Y Govt. sec % growth C. Corporate Sector D. All Citizen (Corp+All Citizen) Sec Total (C+D) Y-o-Y (Corp+All Citizen) Sec % growth E. NPS Lite/ Swavalamban F. APY (NPS-Lite+APY) Sub total (E+F) Y-o-Y (NPS- Lite+ APY) % growth Grand Total (A+B+C+D+E+F)

13 Rs. In crores Y-o-Y % of growth Chart No: 5. AUM (Assets under Management) AUM (Rs.in crore) Mar-12 Mar-13 Mar-14 Mar-15 Jun- Sep- Oct- Nov- Dec- Jan-17 Feb CG SG Corporate Sector All Citizen NPS Lite/ Swavalamban APY Total Y-o-Y Total % of growth AUM of government sector constitutes 88 % of the total AUM under NPS followed by 8 % AUM of Corporate sector, 2% AUM of All Citizen and 1% each of NPS Lite and APY. Chart No: 6. % share of AUM in NPS as on 25 th Feb, 2017 All citizen model 2% Corporate sector 8% NPS Lite 1% APY 1% State Government 49% Government Sector 39% 12

14 Uttar Pradesh Madhya Pradesh Rajasthan Chhattisgarh Maharashtra Karnataka Andhra Pradesh Gujarat Bihar Assam Punjab Orissa Telangana Haryana J & K Jharkhand Himachal Pradesh Utarakhand Kerala Goa Manipur Nagaland Arunachal Pradesh Puduchery** Sikkim Chandigarh** Meghalaya Mizoram Tripura* Tamil Nadu ii. Overall Status of State Governments There are 29 states under NPS. Tamil Nadu has adopted pension scheme under National Pension System (NPS), though it does not contribute towards the employees pension account under NPS. So, PFRDA have to take them on board to make contribution. Besides, West Bengal and Tripura have not adopted the NPS so far, and PFRDA is in discussion with both the states to take them on board, as end of January 2017, Uttar Pradesh has the highest number of subscribers enrolled under NPS followed by Madhya Pradesh, Rajasthan and Chhattisgarh. In terms of contribution and assets under management (AUM), Rajasthan has the highest AUM of Rs. 9,556 crore followed by Maharashtra and Madhya Pradesh. Chart No: 7. State government wise Number of subscribers in NPS (in lakh) (As on 25th Feb, 2017) Total No. of Subscriber(in lakh) Total No. of Subscriber(in lakh) *Executed agreement with CRA and NPS trust only for AIS officer ** Chandigarh and Puducherry status is included under the state government Status 13

15 Rajasthan Madhya Pradesh Maharashtra Uttar Pradesh Karnataka Andhra Pradesh Punjab Haryana Gujarat Chhattisgarh Bihar Telangana Assam Jharkhand Himachal Pradesh Utarakhand Orissa J & K Goa Manipur Puduchery** Kerala Chandigarh** Sikkim Arunachal Pradesh Meghalaya Nagaland Mizoram Tripura* Tamil Nadu Rajasthan Maharashtra Madhya Pradesh Uttar Pradesh Andhra Pradesh Karnataka Punjab Haryana Gujarat Chhattisgarh Bihar Telangana Assam Himachal Pradesh Jharkhand Utarakhand Orissa J & K Goa Kerala Manipur Puduchery** Chandigarh** Sikkim Arunachal Pradesh Meghalaya Nagaland Mizoram Tripura* Tamil Nadu Chart No: 8. State government wise amount of contribution in NPS (Rs.in crore) (As on 25th Feb, 2017) 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1, ,582 Contribution M&B (Rs.in crore) 5,668 5,0984,998 4,104 4,315 3,563 3,315 3,084 2,946 2,517 2,942 2,423 2,3 1,908 2,037 1,7761, Contribution M&B *Executed agreement with CRA and NPS trust only for AIS officer ** Chandigarh and Puducherry status is included under the state government Status Chart No: 9. State government wise Assets under Management in NPS (Rs.in crores) As on 25 th Feb, ,000 10,000 8,000 6,000 4,000 2, ,556 AUM (Rs. in Cr) 6,438 6,500 6,130 5,481 5,264 4,402 4,270 3,869 3,913 3,7373,278 2,739 2,973 2,7312,514 2,2031, AUM(Cr) *Executed agreement with CRA and NPS trust only for AIS officer ** Chandigarh and Puducherry status is included under the state government Status 14

16 Total no.of active account subscriber in Tier-I & Tier-II iii. UoS Sector (All citizens) in NPS As end of February 2017, 76 PoPs with 65,540 service providers are registered with PFRDA to provide NPS services to citizens. While the registration and contribution upload of Government and Government bodies employees is done by their respective Pay & Account offices, the private and the unorganized sector employees are serviced through the PoPs which are banks & non-banking finance companies. As on 25 th February 2017, the total number of active accounts of All Citizen subscribers under Tier I is 365,771 against 325,253 in January As at the end of February, 2017, there are 73,277 subscribers having Tier II accounts under NPS against 61,568 accounts as end of January, Table No: 6. Total number of PoP & PoP-SP & subscribers in CRA Registered PoPs Mar- Apr- May- Aug- Sep- Nov- Dec- Feb- Jun- Jul- Oct- Jan-17 & PoP-SP in CRA Total number of registered PoPs in CRA Total number of registered PoP- SP in CRA 55,580 55,644 55,647 56,065 56,893 56,908 56,959 56,977 57,063 57,489 58,214 65,540 Chart No: 10. Total number of active account subscriber in CRA under Tier-I & Tier-II 400, , , , , , ,000 50, , , , , , , , , , , , ,995 31,002 33,091 34,450 35,283 42,739 46,062 49,340 51,309 51,761 55,255 61,568 73,277 Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-17 Feb-17 Tier I Tier II iv. Total amount of subscribers contribution under UoS (Tier-I & Tier II): The contribution to Tier-I under UoS (All citizen) has increased from Rs. 1,966 crores as on 28 th January, 2017 to Rs 2,232 crores as on February, The contribution received under Tier II as end 15

17 Rs.in Crore of February, 2017 is Rs. 300 crores against the contribution of Rs. 285 crores as end of January, During April - February 2017, the contributions under All Citizen Tier I NPS have increased from Rs. 962 crores to 2,232 crores i.e. a growth of % and Contribution under Tier II NPS has increased from Rs. 1 crores as end of March 20 to Rs. 300crores as at the end of February, 2017 i.e. by %. Chart No: 11. Contribution of subscribers under (UoS) in NPS under Tier-I &Tier-II (Rs. in crores) Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-17 Feb-17 Tier-I Tier-II v. Total amount of AUM under UoS (Tier-I & Tier II) The AUM for UoS under Tier- I as end of February, 2017 was Rs. 23 crores against the AUM of Rs crores as end of January During April Feb 2017, the AUM increased from Rs crores to Rs. 23 crores, i.e %. The AUM of Tier-II has increased from Rs.304 crores as end of January 2017 to Rs. 3 crores in the month of February, During April February 2017, Tier II AUM increased from Rs. 170 crores to Rs. 3 crores, i.e %.

18 Chart No: 12. AUM of individual subscriber (UoS) in NPS under Tier-I &Tier-II (Rs. In crores) Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-17 Feb-17 Tier I Tier II vi. Total number of corporate, subscriber, contribution & AUM registered in Corporate Sector: The total number of corporates registered under NPS has increased from 3,064 as on January 2017 to 3,179 as on February 25 th During the first 11 months of current 20-17, number of corporates registered under NPS has increased from 2,354 to 3,179. Table No: 7. Total number of corporate registered in Corporate Sector: Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- 17 Feb- 17 2,354 2,426 2,474 2,554 2,652 2,728 2,808 2,873 2,911 2,991 3,064 3,179 17

19 AUM & CONTRIBUTION (Rs. In Thousand) Subscriber Chart No: 13. Total number of subscriber, contribution & AUM registered in Corporate Sector Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-17 Feb Contribution amount in corporate sector(rs.in crore) Total number of subscriber registered in Corporate Sector Total AUM in corporate sector (Rs.in crore) As on 25 th February 2017, the number of Corporate registered under NPS is 3,179 with 569,374 subscribers. The contribution received from the corporate subscribers as on 25 th February, 2017 was Rs.11, 599 Crores and AUM was Rs. 14,147 Crores. As on 25 th February 2017, AUM per subscriber for Corporate Sector is Rs.2.48 lakhs. vii. Status of APY: The subscriber base of Atal Pension Yojana has reached 44. lakhs as on February 28 th 2017 from lakhs as end of March 20. AUM under APY has increased from Rs.28 crores as at the end of January, 2017 to Rs Crores as at the end of February Table No. 8. Status of APY Year/Month Mar- Jun- Sep- Oct- Nov- Dec- Jan-17 Feb-17 Subscribers

20 Contribution &AUM (Rs.in crores) Number of subscriber Chart No: 14. Total number of subscriber, contribution & AUM registered in APY Mar- Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan-17 Feb-17 Contribution (Rs.in crore) AUM (Rs.in crore) Subscribers (in lakh) viii. PFM wise Total Assets on NPS schemes Table No: 9. Pension Fund wise Assets under Management (Rs.in crores) Year/Month Mar- Jun- Sep- Dec- Jan-17 Feb-17 PFs SBI UTI LIC KOTAK RELIANCE ICICI HDFC Source: NPST. Website: 19

21 Table No: 10. Scheme wise Assets under Management (Rs.in crores) Pension Funds (SBI+LIC+KOTAK+HDFC+ICICI+RELIANCE+UTI) (Assets Rs in crores ) Total Assets (Rs. In crore) Mar -11 Mar- 12 Mar- 13 Mar- 14 Mar- 15 Mar- Jun- Sep- Oct- Nov- Dec- Jan- 17 Feb- 17 Scheme CG SG Corporate CG E TIER I NPS Swavalamba n TIER II C G E C G Source: NPST. Website: ix. PFM wise Return on NPS Schemes Table No: 11. Returns since inception (in %) As on 28th Feb, 2017 Pension Funds SBI UTI LIC KOTAK RELIANCE ICICI HDFC CG SG Corporate-CG E TIER I C G E TIER II C G NPS Swavalamban Source: NPST. Website: 20

22 Central Government: 1-Apr-08 State Government: 25-Jun-09 Swavalamban: (SBI, LIC, UTI,): 4-Oct-10, (Kotak PF): 31-Jan-12 Corporate (Central Govt. Pattern): 5-Nov-12 Scheme [E, C, G] (Tier-I) - (SBI, UTI, ICICI, RELIANCE, KOTAK): 1-May-09, (LIC): 23-Jul-13, (HDFC PF): 1-Aug-13 Scheme [E, C, G] (Tier-II) - (SBI, UTI, ICICI, RELIANCE, KOTAK): 14-Dec-09, (LIC): 12-Aug-13, (HDFC PF): 1-Aug-13 x. Performance of NPS Schemes of Central Government & State Government Employees Table No: 12. Performance: Scheme CG (As on February 28th, 2017) SCHEME CG PFM Financial Year Return (%) Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI Source: NPST. Website: Table No: 13. Performance: Scheme SG (As on February 28 th, 2017) PFM Scheme SG Financial Year return (%) Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI Source: NPST. Website: 21

23 xi. Performance of NPS schemes for Unorganized/Private Sector Table No: 14. Performance: Scheme E- Tier I (As on February 28 th, 2017) PFM Scheme E- Tier I Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: Table No: 15. Performance: Scheme E- Tier-II (As on February 28 th, 2017) PFM Scheme E- Tier II Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: 22

24 Table No:. Performance: Scheme C- Tier I (As on February 28 th 2017) PFM Scheme C- Tier I Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: Table No: 17.Performance: Scheme C- Tier II (As on February 28 th 2017) PFM Scheme C- Tier II Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: 23

25 Table No: 18. Performance Scheme G- Tier I (As on February 28 th 2017) PFM Scheme G- Tier I Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: Table No: 19. Performance Scheme G- Tier II (As on February 28 th 2017) PFM Scheme G- Tier II Financial Year Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI ICICI KOTAK RELIANCE HDFC IDFC Source: NPST. Website: Table No: 20. Performance: Scheme NPS -Lite (As on February 28 th 2017) PFM Scheme NPS-Lite Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI UTI KOTAK Source: NPST. Website: 24

26 Table No: 21. Performance: Scheme Corporate- CG (As on February 28 th 2017) Scheme Corporate CG PFM Return % Return (%) Yr 2-Yr 3-Yr 5-Yr LIC SBI *Source: NPST. Website: 25

27 Section 3: Circulars/Notices/Guidelines Issued/Advisory CIRCULARS i) Proper checks and controls in collection of NPS contributions (PFRDA/2017/2/PoP/1). Dated 03 rd Jan, 2017 Point of presence (PoP) is an important intermediary under the NPS architecture, which is entrusted with the most important assignment of on boarding of subscribers under NPS and providing them various services under it. In order to provide maximum convenience and to ensure ease of transaction to the subscribers, the Point of presence (PoPs) are also providing new options to the subscribers for remittance of NPS contributions to the collection account maintained at their end. The PoPs are now-a -days collecting NPS contributions through various channels including online payment gateways, keeping in view the thrust on digital modes of payment. In this direction, it is also important that all the NPS contributions collected by a PoP through various modes are accounted for and essential details of the NPS subscribers are captured properly. All the PoPs must ensure that proper checks controls and mechanisms are in place so that no unaccounted funds are collected without details of the corresponding PRANs. In case, details of the PRANs are not captured at the time of collecting NPS contributions the same may result in building of a pool of unreconciled amount, which is highly unwarranted and detrimental to the interest of the subscribers, leading to high number of grievances. Besides, reconciliation of such amounts without details of corresponding PRANs will be an uphill task in the future. The PoPs also need to ensure that in case, they provide the facility to their NPS subscribers for remittance of NPS contributions directly to the collection accounts of the PoPs, the NPS contributions are not collected without capturing details of the PRAN in which the same have to be credited. All the Point of Presence (PoPs) are advised to disseminate information regarding this to all the PoP- SPs for ensuring compliance at their level. ii) Circular on Reactivation of frozen PRANs where 20% of the accumulated pension corpus has been withdrawn as lump sum but subscriber subsequently reemployed in establishments covered under NPS (PFRDA/2017/3/CSG/1) Dated 01 st Feb, The Pension Fund Regulatory and Development Authority has been receiving requests from government employees subscribing to NPS who had on premature leaving/change of employment discontinued their NPS account, and in some case, had also withdrawn the lump sum amount as applicable under the Exit under NPS Regulations, to reactivate the PRAN account/open a new PRAN on reemployment/ reinstalment in establishment which are covered under the NPS. In some cases subscribers had withdrawn 20%lump sum amount in their PRANs which were later deactivated. Later 26

28 they got new PRANs generated due to fresh employment, which also got deactivated as these being duplicate PRANs. Thus, in such a scenario the subscriber could not use either the previous PRAN or the new PRAN. 2. In this context, it may be clarified that PRAN is unique and portable across locations and employment. The same PRAN should continue throughout the working tenure of the employee/subscriber. As currently applicable, the subscriber is required to intimate his previous PRAN to the employer on joining new service. The basic purpose of NPS is to provide social security to the subscribers during their old age. If subscribers withdraw, inspite of the fact that they can continue in the system up to their superannuation from service or 60years of age. The very purpose of NPS is defeated. 3. With a view to preserve the accumulation for pension and alleviate the hardship during old age, all NPS subscribers are advised to continue in the system with the same/first PRAN till the subscriber attains the age of superannuation or 60 years even if the subscriber has become jobless temporarily and withdrawn 20% from his/her PRAN. The 20% withdrawn amount will be considered as a special withdrawal and same PRAN would be activated on the employees joining a new employer and making contribution to the NPS. iii) Circular on Operationalization of M/s Karvy Computershare Private Limited as second CRA under NPS (PFRDA/2017/5/CRA/2) Dated 09 th Feb, 2017 Reference is drawn to our circular no. PFRDA/2017/1/CRA/1, dated January 03 rd, 2017 on operationalization of Karvy Computershare Private Limited as second Central Record Keeping Agency (CRA) for NPS. The Authority has decided to allow M/s Karvy Computershare Private Limited to start its operations for servicing of accounts sourced through e-nps module of NPS Trust wherein the subscriber would be provided an option to choose between NSDL e-governance Ltd (1 st CRA) and M/s Karvy Computerized Pvt. Ltd (2 nd CRA) with effect from February 15, 2017 and other distribution channels thereafter. It has been decided that M/s Karvy Computershare would be allowed to service the new accounts till March 31 st 2017 and thereafter it would be allowed to function as a full-fledged CRA with interoperability functionality providing for option to shift for existing subscribers of NPS from April 01 st 2017 onwards. Under sub regulation 4 of regulation 3 the CRA Regulations, the allocation of the subscribers between the existing Central Record Keeping Agency and the other Central Record Keeping Agency or agencies, if appointed shall be based on a transparent criteria and process as may be notified by the Authority from time to time having regard to the subscribers interest. Accordingly, the criteria of allocation of subscribers are mentioned as under: 27

29 In case where there are employee-employer relationship, including corporate, if the CRA charges are being borne by the employer, the decision to select the CRA shall rest with the employer, unless they specifically delegates the option to individual employees and in all other cases, the choice of selection of CRA will rest with the employee/ subscriber under NPS. In case of voluntary subscribers (without existence of any employer-employee relationship) the option to choose a CRA rests with the subscriber in general. In case of subscribers registered under Atal Pension Yojana, the respective Government will choose the CRA rendering the services. In case of NPS-Lite subscribers the aggregators will have the option to choose the CRA. The charge structure for NPS regular and NPS Lite subscribers is provided hereunder the information of all concerned: S.N Service charge head M/s NSDL e-governance Infrastructure Ltd (1st CRA) NPS Regular NPS-Lite/APY (Rs.) (Rs.) M/s Karvy Computerised Pvt. Ltd (2nd CRA) NPS Regular NPS-Lite/APY (Rs.) (Rs.) 1 PRA opening charges 2 PRA Annual maintenance charges 3 Transaction charges NIL 3.36 NIL Further the charge structure with effect from 01 st April, 2017 would be as under: S.N Service charge head M/s NSDL e-governance Infrastructure Ltd (1st CRA) NPS Regular NPS-Lite/APY (Rs.) (Rs.) M/s Karvy Computerised Pvt. Ltd (2nd CRA) NPS Regular NPS-Lite/APY (Rs.) (Rs.) 1 PRA opening charges 2 PRA Annual maintenance charges 3 Transaction charges NIL 3.36 NIL This is issued for the information of all concerned. 28

30 iv) Circular on Charges and incentive structure under NPS w.e.f. 01/04/2017 (PFRDA/2017/5/SWM/1) Dated 20 th Feb, As per the existing revenue structure for Aggregators under NPS-Lite/Swavlamban, till the Aggregators are paid Rs. 100/- for opening/servicing every persistence NPS-Lite/Swavlamban account, provided the contribution deposited by the subscriber is between Rs. 1000/- to Rs /- in a financial year. However the incentive is applicable till only. 2. In order to continue the incentives for the Aggregators even after so that they continue to service the subscriber base of NPS-Lite attached to them, the following charge and incentive structure has been approved by PFRDA and will be applicable w.e.f : Charges under NPS-Lite/Swavlamban w.e.f * The charges for any subsequent transaction under NPS- of the total contribution deposited by the subscriber in NPS-Lite/Swavlamban in a financial year subject to a minimum of Rs. 20/-. Method of leaving charges Through unit deduction by NSDL/CRA at the end of the financial year. Any other transaction not involving a contribution from Rs. 10/- per transaction. 3. All the Aggregators are hereby advised to take note of the same and also disseminate information regarding the same to the associated nodal offices including facilitators. 4. It is further advised that an Aggregator is not permitted to collect any charge or fee upfront from subscriber. In case of any violation of these instructions suitable action will be initiated as envisaged in the PFRDA (Aggregator) Regulations, v) Constitution of Subscriber Education and Protection Fund (SEPF) Committee (PFRDA/20/27/HR/3) Dated 21 st Feb, 2017 In partial modification of Circular No. PFRDAl20/24/HR/2 dated 7th December, 20, Sh. Rajesh Kumar, Chief Controller of Accounts (Home), Ministry of Home Affairs has been nominated to the Subscriber's Education and Protection Fund Committee in place of Sh. Bhupal Nanda. The rest of the aforementioned circular dated 7th December, 20 remains unchanged 29

31 vi) Notice- Appointment Of Training Institute For Imparting Training On Pension Schemes Regulated/Administered By Pension Fund Regulatory And Development Authority (PFRDA) For North West Zone ( ) PFRDA has appointed IL & FS Skill Development Corporation Ltd, 2 nd Floor, DND Flyway, Near Toll Plaza,Noida as the training institute to create mass awareness and impart training on pension schemes under National Pension System and Atal Pension Yojana to the employees of Points of Presence (POPs) /POPService Providers /APY-Service Providers/Corporates/ Nodal officers of Central & State Governments/ Nodal officers of Central and State Autonomous Bodies/ Retirement advisors and other stakeholder registered with PFRDA, in the North West Zone of the country. The zone comprises of the following States and UTs: Jammu and Kashmir, Himachal Pradesh, Uttar Pradesh, Uttaranchal, Punjab, Haryana, Bihar, Jharkhand, Chandigarh, Delhi, Goa, Gujarat, Maharashtra, Madhya Pradesh, Rajasthan, Chhattisgarh, Daman and Diu, Dadra and Nagar Haveli. With a view to draw a detailed training schedule, all the intermediary offices have been requested to furnish the list of nominees/persons to be trained to the appointed training agency to Ms Alfa Mary and Mr Avinash Goregaonkar at the following id : pfrda.isdc@ilfsindia.com under advice to PFRDA. It is intended to have at least participants in each session of 3-4 hours duration and conduct approximately 10 training sessions and train participants in the NW zone over the next 12 months. On receipt of the nominations, the agency would be establishing contact with the nominated nodal officials for further co-ordination and logistics. vii) Advisory for all the Pension Fund and Custodian regarding investments in Mutual Fund schemes ( ) 1. PFRDA has appointed SHCIL as custodian of Securities for custody of the securities pertaining to the funds under management under all schemes of NPS/APY. 2. It is observed that some Pension Funds are not keeping some of the securities particularly mutual fund units with the appointed custodian. 3. It is advised that all Pension Funds shall maintain the holding in mutual funds with the appointed custodian. 4. Pension funds are further advised to convert the existing holdings of mutual funds units in de-mat form in coordination with SHCIL under confirmation to the NPS Trust and the Authority. 30

32 Section 4: Workshops /Press Release/Conference conducted /Awards i) PFRDA conducts Strategy Meeting with Service Providers under APY / NPS at Bangalore (22-Feb-2107) The APY was launched by Honourable Prime Minister of India on 09th May, 2015 and became operational from 1st June, APY is available for all citizens of India in the age group of years. Under the APY, the subscribers would receive a minimum guaranteed pension of Rs per month, Rs per month, Rs per month, Rs per month, Rs per month, at the age of 60 years, depending on their contributions, which itself would vary on the age of joining the APY. There are more than 43 lacs subscribers registered in the scheme till date. 2. PFRDA had conducted review cum strategy meeting on at Bangalore & on at Chennai for Public Sector Banks, Private Sector Banks and Regional Rural Banks and POPs having their head office in southern part of India. 3. Shri A G Das, Chief General Manager, PFRDA had addressed the meeting where Chairmen/Senior officials of the Banks/RRBs were present. A review on the past and current performance of the banks vis-a-vis their target for last and current financial year was conducted. The APY service providers- Banks had shared their action cum strategy plan to meet stipulated target in last quarter of the 20-17, this activity was performed to highlight the importance of Atal Pension Yojana (an old age income security scheme of Govt. of India) and to address the issues in promoting the scheme to grass root level. 31

33 4. PFRDA had awarded best performing branches/banks in the meeting for their outstanding performance in various campaigns organised by DFS/PFRDA : 32

34 5. PFRDA had offered capacity building assistance for Staffs/BCs of the banks and other promotional material assistance as well. PFRDA expects good number of enrolments in last quarter of ii) Budget New Benefits announced for NPS Subscribers In a bid to provide further impetus to the National Pension System (NPS), the following provisions have been introduced in the Finance Bill 2017 laid down in the Parliament today. (i) Tax-exemption to partial withdrawal from National Pension System (NPS) The existing provision of section 10(12A)of the Income Tax Act, 1961 provides that payment from National Pension System (NPS) to a subscriber on closure of his account or opting out shall be exempt up to 40% of total corpus at the time of withdrawal. The amount utilized for purchase of annuity is also tax exempt. At the time of normal exit, 40% of the total corpus is mandatorily required to be purchased for annuity. The subscriber has the option to use higher amount for purchase of annuity. In order to provide further relief to the subscriber of NPS, it has been proposed to insert a new clause (12B) in the section 10 of Income Tax Act, 1961 to provide exemption on partial withdrawal not exceeding 25% of the contribution made by an employee in accordance with the terms and conditions specified under Pension Fund Regulatory and Development Authority Act, 2013 and regulations made there under. This benefit will be effective on partial withdrawal made by the subscriber after 1st April (ii) Further, Contribution up to 20% of the Gross Income of the Self-employed individual (Individual other than salaried class) will be deductible from the taxable income under Section 80CCD (1) of the Income Tax Act, 1961, as against 10% earlier. This is with a view to provide parity between a salaried employee and a self-employed, This benefit will be available on contribution made by the self-employed persons on or after 1st April