**Finance Minister Nirmala Sitharaman Proposes ‘Pension Sakhis’ to Boost Social Security Coverage**
*New Delhi:* Emphasising the need for broader pension coverage among the informal and self-employed segments, Finance Minister Nirmala Sitharaman on Wednesday urged the Department of Financial Services (DFS) and the Pension Fund Regulatory and Development Authority (PFRDA) to explore the possibility of training women as ‘Pension Sakhis’ to deepen social security coverage.
Speaking on the occasion of NPS Diwas, the finance minister highlighted the importance of extending pension benefits to informal workers, the self-employed, and platform or gig economy workers. She suggested simplifying the onboarding process by offering local language interfaces and enabling doorstep e-KYC, making enrolment fast and user-friendly.
“There is a need to deepen women’s pension security through workplace auto-enrolment, ensuring contribution continuity during maternity and caregiving breaks, and facilitating micro auto-debits which prevent small regular savings from lapsing,” Sitharaman said.
Drawing a parallel with the ‘Bima Sakhis’ initiative by LIC, the minister said, “I want the DFS and PFRDA to explore training women as ‘Pension Sakhis’ and incentivise them for a sustained increase in enrolment.”
She further emphasised promoting financial literacy early in schools, ITIs, colleges, and community centers so that households start their pension contributions in their 20s or early 30s. “The National Pension System (NPS) should truly become a ‘Jan Andolan’,” she added.
**Enhancing Pension System Efficiency and Sustainability**
The Finance Minister stressed focusing on keeping costs low and improving service quality. She advocated for time-bound, digital-first grievance redressal mechanisms, clear disclosures, and seamless portability across products and platforms.
To ensure fiscal sustainability, Sitharaman underscored the need to align contributions with prudent asset allocation and inflation-aware benefits, helping pensions remain reliable through changing economic cycles.
“The growth of any nation depends largely on the robustness of its social security framework. Innovative pension and retirement solutions are essential to address the supply and demand on both industry and consumer sides,” she remarked.
**Attractive Returns and Low Costs Under NPS**
Highlighting the performance of NPS schemes, the minister noted that since inception, average annual returns have been over 13% for equity schemes, and around 9% for Corporate Debt and Government Securities schemes. “NPS remains one of the lowest-cost pension fund management schemes globally, meaning more money stays invested and grows,” she said.
**New Developments: Forum for Regulatory Coordination & Multiple Scheme Framework**
In the Budget 2025-26, the government announced the establishment of a forum for regulatory coordination and pension product development. Reflecting this, Sitharaman revealed that the ‘Forum for Regulatory Coordination and Development of Pension Products’ was set up in August 2025. This forum brings together PFRDA, EPFO, IRDAI, SEBI, and relevant ministries.
The forum’s main objectives include developing a common regulatory and supervisory framework, harmonising investment standards across pension products, strengthening consumer protection and grievance redressal, and ensuring robust systemic risk management of assets under management.
The Finance Minister also announced the implementation of the Multiple Scheme Framework (MSF) effective from October 1. Under MSF, non-government NPS subscribers can allocate up to 100% of their funds in equities—higher than the current 75% limit in high-risk options. Each scheme will have moderate and high-risk variants, providing investors with greater flexibility.
Additionally, investors can choose new schemes under MSF without needing to invest in existing “common schemes,” and non-government subscribers can opt for multiple schemes across different Central Recordkeeping Agencies (CRAs) under a single Permanent Retirement Account Number (PRAN).
Cost structures under MSF will remain capped at 0.3% of assets under management annually, with an additional 0.1% incentive for pension funds that bring in new subscribers.
**Government’s Push to Drive Pension Savings**
Speaking at the event, Financial Services Secretary M Nagaraju acknowledged that India’s investment in pension plans remains low, with more inflows diverted to other savings instruments.
“The government has created adequate room for the pension sector to grow. Now, we need to explore ways to channel more inflows towards pension savings,” he said.
He added that dual tax benefits announced in the Budget for 2025-26, along with recent comprehensive Goods and Services Tax (GST) reforms, are expected to save over Rs 2.5 lakh crore annually. These reforms are likely to deepen the pension sector by increasing household disposable incomes and encouraging higher savings directed to pensions.
Chief Economic Adviser V Anantha Nageswaran noted that government reforms, including GST rationalisation, aim to boost the domestic economy amid global pressures by encouraging increased savings.
**Current Assets and Future Challenges**
According to data from the NPS Trust, total assets under management for the National Pension System stood at Rs 15.48 lakh crore as of August 31.
Nagaraju highlighted ongoing efforts to popularise pension plans and improve their penetration; however, challenges persist, particularly in prudent pension fund management. He urged fund managers and the PFRDA to develop newer, bespoke products to meet evolving sector needs.
He further stressed the importance of adding subscribers from the informal and non-government sectors to the National Pension System.
—
*Disclaimer: This story is from the syndicated feed. Only the headline has been changed.*
https://www.freepressjournal.in/business/financial-services-department-pfrda-should-train-women-as-pension-sakhis-finance-minister-nirmala-sitharaman
