NPS fee hike to make pension fund management sustainable: IDFC

IDFC said, the proposal to raise fund management charges in NPS will sustain the pension fund industry in the long-run as all players are losing money with the current charges

 
Mumbai: IDFC, one of the fund managers of National Pension Scheme (NPS), said the proposed revision in fund management charges will help sustain the retirement fund industry in the long-run as all players are losing money under the present fee structure, reports PTI.
 
"The proposal to raise fund management charges in NPS will sustain the pension fund industry in the long-run as all players are losing money with the current charges," IDFC Chief Executive for Pension Funds Vikash Raj told reporters here.
 
He said as per the revised NPS guidelines, management charges will be revised soon, which is a welcome step.
 
At present, fund management fee is a dismal 0.0009% per Rs10 lakh in which all fund managers are losing money.
 
However, the revised guidelines have a provision for raising the commission with a cap provided by the pension fund regulator, PFRDA.
 
"If it (the charge) is fixed at around 0.25%, then the business model will be sustainable," Raj said.
 
Reacting to new norms about appointing any number of fund managers from the existing six, he said this would help in garnering a higher number of subscribers.
 
Total corpus of NPS, a contribution-based scheme launched in May 2009, is around Rs18,000 crore, majority of which is contributed by the public sector employees.
 
"As the number of players (fund managers) increase, this will help in raising the investor base," Raj said.
 
NPS, among the low-cost pension schemes in the world, has failed to take off among general public and private sector employees due to less awareness about the plan, he said.
 
"As awareness increases, the NPS is likely to become popular among the private sector employees and general public," he added.
 

User

COMMENTS

SANJAY SINVHAL

5 years ago

If current NPS charges are low, then why are the MFs falling over each other to garner NPS business. They are free to leave this business rather than incurring so called losses. Infact, unlike MFs wherein fund houses have to print application forms, pay commission to agents, spend in Mktg & advtg etc, in NPS they get assured amount every month from employees. So why crib???

Call us

 022 - 49205000

User

SBBJ opens first Financial Super Market branch in Jaipur

The specialised banking outfit would primarily sell products like insurance, life and general, credit card and mutual fund instead of the traditional products of deposit and loan

Jaipur: The State Bank of Bikaner and Jaipur (SBBJ) on Thursday opened its first Financial Super Market branch in the city, aiming to sell non-standard products like insurance, credit card and mutual fund, reports PTI.

 

"This is a first-of-its-kind financial super market in the country. The focus of the well-equipped specialised banking outfit is primarily on selling products like insurance, life and general, credit card and mutual fund instead of the traditional products of deposit and loan," SBBJ Managing Director Shiva Kumar said.

 

The branch has been opened in a mall at Tonk Road.

 

"Cross selling of non-traditional banking products like insurance and mutual front is gaining momentum across the country and there is a need for specialised outfits to serve the needs of better educated diversifying customers," he said.

 

SBBJ Financial Supermarket will primarily sell and service products of its channel partners like SBI Life, Mutual Fund, SBI General and SBI Card, both across the counters and through electronic means.

 

The Channel partners have stationed their specialists at this Branch.

 

"Banking products are diversifying rapidly and the needs of customers are more varied now.

 

The attempt of SBBJ is an answer to the emerging needs of customers to approach a brick and mortar set up for services and resolution," he added.

 

"Customers desire a location to have the confidence of seeking resolution of any issue. The customer will get this satisfaction with the launch of this Financial Supermarket," Kumar said.

 

He informed that the Supermarket will not only serve the walk-in customers but also provide online and direct support to all its branches and customers across India.

 

"We expect to enhance our other income with the launch of the Financial Supermarket," he said.

User

COMMENTS

Dev Balic

5 years ago

Good to know that the focus of the well-equipped specialized banking outfit is primarily on selling products like insurance.

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)