Categories: Economy

FDI limit in NPS fund managers hiked to 74%

The government notified a hike in the foreign direct investment limit in pension fund management to 74% from 49% under the national pension system (NPS). This step is opening doors for experienced foreign partners in this space and facilitating more competition in the fledgling segment. Pension Fund Regulatory &Development Authority (PFRDA) Act links the FDI ceiling in the insurance sector.

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National Pension System (NPS) was launched in January 2004 for government employees and later in 2009, it was opened to all. There are two types of accounts in NPS – Tier 1 and Tier 2. If a person invests in Tier 1 account then he/she gets an additional tax exemption of up to Rs 50,000. National Pension Scheme is being regulated by PFRDA.

7 Pension Funds in NPS:

HDFC Pension Management
ICICI Pru Pension Funds Management
Kotak Mahindra Pension Fund Management
LIC Pension Fund
SBI Pension Funds
UTI Retirement Solutions
Aditya Birla Sun Life Pension Management

The benefit of FDI in Pension Funds:

Many companies need capital for their expansion and due to the increase in FDI limit, they will get more money.
Existing fund holders will also be able to sell their excess stake.
Foreign companies will be able to provide new products, technology.
Help in increasing the reach of pensions.

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Sumit Arora

As a team lead and current affairs writer at Adda247, I am responsible for researching and producing engaging, informative content designed to assist candidates in preparing for national and state-level competitive government exams. I specialize in crafting insightful articles that keep aspirants updated on the latest trends and developments in current affairs. With a strong emphasis on educational excellence, my goal is to equip readers with the knowledge and confidence needed to excel in their exams. Through well-researched and thoughtfully written content, I strive to guide and support candidates on their journey to success.