Gift your domestic help a pension through WhatsApp | Mint
Active Stocks
Tue Feb 20 2024 15:54:00
  1. Power Grid Corporation Of India share price
  2. 287.95 4.16%
  1. HDFC Bank share price
  2. 1,453.75 2.59%
  1. Tata Steel share price
  2. 141.05 -0.60%
  1. NTPC share price
  2. 345.65 2.01%
  1. ITC share price
  2. 406.05 -0.77%
Business News/ Money / Personal Finance/  Gift your domestic help a pension through WhatsApp

Gift your domestic help a pension through WhatsApp

pinBox Solutions, a fintech focused on micro pension to offer pensions over WhatsApp to domestic help and other informal sector workers

Photo: iStockPremium
Photo: iStock

Signing up for a pension in India means filling up long and complicated forms. However, a series of regulatory changes and tech innovations have enabled pinBox Solutions, a fintech focused on micro pensions to offer pensions over WhatsApp to domestic help and other informal sector workers. The project called ‘Gift-a-Pension’ allows any person to gift a pension to another person by opening a National Pension System (NPS) Tier I account for them. pinBox has tied up with HDFC Pension Fund for this project. The account can be opened by answering a series of questions over WhatsApp . The beneficiary of the pension account only needs to have a bank account and mobile number that is linked to their Aadhar card.

“The beauty of NPS is that it is not rigid and this really suits informal sector workers. You can contribute, say 1,000 one month and 3,000 the next. The minimum amount needed to open an NPS account is just 500," said Gautam Bhardwaj, co-founder and director, pinBox Solutions. “Unlike a mutual fund where the investment has to come from the investor’s bank account, anyone can contribute to another person’s NPS account. The only requirement is that the money has to come from a bank account, it cannot come in cash. So, for example, if a domestic worker is employed in multiple homes, several employers can make contributions to the account of the worker," said Bhardwaj.

View Full Image

“It doesn’t even have to just be your house help. You can gift a pension to anyone—your wife, your friend or your parents," he added. pinBox also has a calculator which allows contributors to get an estimate of how much their pension corpus can grow to by the age of retirement. While pinBox provides the technology, the actual investment process is carried out by a HDFC Pension Fund which is also a registered point-of-presence (PoP) under the NPS. pinBox, in turn, is compensated by HDFC Pension Fund. You can make your contributions to the account using a UPI-enabled app such as BHIM, Google Pay or WhatsApp pay apart from net banking. You have to contribute a minimum of 1,000 per annum to keep the account active. Account opening costs between 200 and 400 and there is a charge per contribution levied by the PoP that can go up to 0.5% of the amount contributed (minimum of 30). For example, a contribution of 5,000 per month will attract a charge of 30. These charges are automatically deducted from your contributions. The money is then invested in equities, corporate bonds and government bonds, according to a NPS lifecycle fund chosen by pinBox initially (which the subscriber can later change). You have to contribute a minimum amount of 1,000 per year. Pension Fund Managers (PFMs) also have their charges, but this is capped at a low level of just 0.09% (9 basis points).

The WhatsApp number for Gift a pension is +91 80 2300 2000.

The NPS Tier 1 account matures at the age of 60 and the accumulated corpus can be used to buy an annuity (regular pension). “This is a great initiative and if it takes off then it can greatly increase the pension coverage in India, especially in the unorganized sector. Tech is a big barrier and apps like WhatsApp can help bring those barriers down. Gift-a-Pension is currently in its early stages and we are exploring how we can scale it up," said Sumit Shukla, CEO, HDFC Pension Fund.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Neil Borate
Neil heads the personal finance team at Mint. A former colleague called them 'money nerds' and that's what they are. They cover topics like mutual funds, taxation and retirement, all to improve your chances of building wealth. Neil graduated with a degree in law and economics. He passed the CFA Level I exam and began his writing career at Value Research, a mutual fund research firm in 2016. He joined the personal finance team Mint in 2019. Everyday, the Mint Money Team tackles personal finance questions such as where to invest and where to borrow, through articles, charts and reader queries. They also have a daily podcast - 'Why Not Mint Money' and an annual ranking of mutual funds - the Mint 20.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Check all the latest action on Budget 2024 here. Download The Mint News App to get Daily Market Updates.
More Less
Published: 16 Feb 2022, 11:19 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App