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Banks to Sponsor India Pension Funds!
1 Jan
Summary
- Banks can now sponsor National Pension System funds.
- New NPS investments include gold, silver ETFs, and Nifty 50.
- Investment management fees to be revised from April 2026.
Banks in India have received in-principle approval to sponsor pension funds managing assets under the National Pension System (NPS). This significant regulatory shift by the Pension Fund Regulatory and Development Authority (PFRDA) aims to foster greater competition within the sector.
Eligibility criteria for sponsoring banks include robust net worth, market capitalization, and financial stability, aligning with Reserve Bank of India guidelines. This development expands the investment horizons for NPS subscribers, who can now allocate funds to gold and silver ETFs, the Nifty 50 index, and Alternative Investment Funds.
The PFRDA is also implementing broader reforms, including a revision of Investment Management Fees effective April 1, 2026. Additionally, three new trustees, including a former State Bank of India chairman, have joined the NPS Trust Board.
