PFRDA targets 35-40 crore NPS subscribers in 5 years from 90 lakh, plans digital push to expand pension coverage

The Pension Fund Regulatory and Development Authority (PFRDA) is targeting a sharp expansion in the National Pension System (NPS), with non-government subscribers expected to rise to 35-40 crore over the next five years from around 90 lakh currently.

PFRDA chairman Sivasubramanian Ramann announced the target at an outreach event in Kolkata on Friday, according to an Economic Times report. He said the regulator expects the digital push in the pension sector to add around 2-3 crore subscribers every year.

The target would require NPS to move well beyond its traditional base of salaried and government-linked subscribers and reach a much larger pool of private-sector workers, self-employed individuals and other non-government subscribers.

PFRDA wants digital onboarding to drive NPS growth

A key part of PFRDA’s strategy is greater use of technology and distribution networks to make NPS easier to access. Ramann said the regulator wants to replicate the scale achieved by Atal Pension Yojana, which has brought in 10 crore subscribers through banks and regional rural banks.

PFRDA has also been pushing the StAR NPS platform developed by BSE Technologies. In a June circular, the regulator said the platform would facilitate technology-enabled assisted onboarding through Points of Presence and their associated pension agents, including mutual fund distributors.

The platform is designed to connect the onboarding process with Central Recordkeeping Agencies and the Trustee Bank, while supporting digital verification and other processes. The regulator’s objective is to make NPS access simpler while expanding its reach through existing financial distribution networks.

The move could give mutual fund distributors a larger role in pension distribution. PFRDA is encouraging them to act as pension agents and use their existing customer networks to bring more people into the NPS ecosystem.

Four new pension funds approved as NPS choice expands

PFRDA has also approved four new pension funds, taking the total number of pension funds to 14, Ramann said in Kolkata, according to ET.

The expansion of pension fund options comes as the regulator seeks to make NPS more attractive to a wider investor base. Subscribers can choose among the available pension funds under the NPS framework, giving them greater choice over how their retirement savings are managed.

Ramann also highlighted the long-term performance of NPS conservative schemes, saying they had delivered annualised returns of 9.2-9.3% over the past 15 years.

However, reaching 35-40 crore non-government subscribers from around 90 lakh would require a substantial acceleration in adoption. PFRDA’s strategy therefore combines digital onboarding with a wider network of distributors and pension agents.

The regulator is effectively betting that easier access, more distribution points and technology-led onboarding can make retirement planning a mainstream financial product rather than something people start considering only close to retirement.