The upper age limit for a retiree to join India’s National Pension Scheme (NPS)— has been increased by five years to age 65, the Pension Fund Regulatory and Development Authority (PFRDA) announced Monday.
Confirmed by PFRDA chairman Hemant Contractor at a conference regarding “Transferring Superannuation Funds to National Pension System,” the change is intended to “open up pensions to sectors that are without pensions.” Currently, 85% of employees in India are working in the unorganized and informal sectors, and only 15% to 16% are covered by the NPS, which he added is currently the “lowest-cost pension product in the world.”
“NPS is currently open for people between 18 and 60, and our Board has approved raising the age limit for joining to 65,” Contractor said. “The scheme anyway has the option of continuing and making contributions up to the age of 70.”
The NPS offers members choices ranging from equity and secure government bonds to life-cycle funds, with equity investments able to go up to 75% of their contribution should they select the life-cycle fund. It also offers safer options with a large chunk of fixed-income investment.