MUMBAI, Jan 1 (Reuters) – India’s pension fund regulator has allowed banks to sponsor pension funds that will manage monies under the National Pension System (NPS), in a bid to bolster competition in the sector.<\/p>\n
\n The Pension Fund Regulatory and Development Authority (PFRDA), which oversees assets worth more than $177 billion, said in a statement on Wednesday that it had given in-principle approval for banks to independently set up pension funds to manage the NPS, subject to eligibility norms aligned with the Reserve Bank of India’s guidelines.<\/p>\n
\n Banks will have to meet eligibility criteria linked to net worth, market capitalisation, and prudential soundness, it added.<\/p>\n
\n Currently, banks serve as points of presence, handling subscriber registrations, contributions, and other system services. Some existing pension funds have ties to financial institutions, including banks. <\/p>\n
\n At present, there are 10 registered pension funds with the PFRDA.<\/p>\n
\n The change is part of broader reforms by the regulator. In December last year, the PFRDA allowed NPS subscribers to invest in gold and silver exchange-traded funds, the Nifty 50 index, and Alternative Investment Funds.<\/p>\n
\n The regulator also revised the Investment Management Fee structure for pension funds starting April 1, 2026, according to the latest release. <\/p>\n
\n Additionally, three new trustees have been appointed to the NPS Trust Board, including Dinesh Kumar Khara, a former chairman of the country’s largest lender, State Bank of India.<\/p>\n
(Reporting by Gopika Gopakumar; Editing by Rashmi Aich)<\/p>\n
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