Buoyant equity markets and a widening NPS subscriber base in private sector have encouraged pension regulator PFRDA to target NPS assets of ₹15-lakh crore by March 2025. This reflects a 28 per cent jump over AUM of ₹11.73-lakh crore recorded as of end March 2024.
“The target of ₹15-lakh crore is certainly not ambitious. Achieving this target is however subject to the equity markets continuing with its ongoing momentum,” Deepak Mohanty, Chairman, PFRDA, said here on Friday.
As of June 15, NPS assets stood at ₹12.39-lakh crore, up 28.28 per cent year-on-year.
It maybe recalled that a strong-showing from the non-government sector helped NPS assets record a robust 30.5 per cent year-on-year (YoY) growth in 2023-24 to touch ₹11.73-lakh crore as of end March 2024.
The rapid growth of overall NPS assets is evident as the AUM was only about ₹1-lakh crore in 2015. NPS assets had reached the ₹10- lakh crore mark in August last year.
Expansion plan
Mohanty said that PFRDA is now aiming to onboard about 11 lakh new NPS subscribers from private sector in 2024-25. In previous fiscal, as many as 9.7 lakh private sector employees enrolled for NPS.
Private sector has been key reason behind NPS assets’ sharp increase in recent years.
Over the last one year as of June 14, the average returns generated by pension funds on the equity scheme investments stood at whopping 34.89 per cent, PFRDA data showed. Since inception of NPS, average return from equity schemes stood at 14 per cent.
The number of new NPS and APY subscriber registrations till June 17 this fiscal stood at 1,62,731, PFRDA data showed.
BALANCED LIFE CYCLE SCHEME
Mohanty said on Friday that PFRDA will in July-September roll out a new Balanced Life Cycle Scheme. This option — which is an improvement of existing LC50 (moderate life cycle fund) will be available for private sector under the automatic choice window. The new scheme will initially be allowed only for private sector NPS subscribers but could be extended to the government sector in coming days.
“Under the new scheme, the tapering will start from age of 45 years. Till the age of 45 years the scheme will allocate 50 percent of investments to equity and then gradually reduce as per the age of subscriber. The debt portion will be 50 percent till 45 years,” Mohanty explained.
Currently, for those opting to existing LC 50, the investment towards equity is 50 per cent and tapering begins at 35 years, he added. There will also be other benefits from proposed new Balanced Life Cycle Fund.
On Atal Pension Yojana, Mohanty said the Pension Fund Regulatory & Development Authority had onboarded 1.2 crore subscribers in 2023-24. This fiscal the target is 1.3 crore, he added. Total AUM under Atal Pension Yojana — a scheme for the unorganised sector — stood at ₹37,850 crore as of June 15.