NPS to grow over 30% in FY26, says PFRDA chief Sivasubramanian Ramann

The Pension Sakhi model, inspired by bima sakhis, is a very important initiative, said PFRDA Chairman

Pension Fund Regulatory and Development Authority (PFRDA) Chairman Shri Sivasubramanian Ramann, in an exclusive interview with Harsh Kumar in New Delhi, said the regulator is exploring ways to effectively reach the rural segment. He said the proposal to implement pension sakhis, suggested by the finance minister last week, is both practical and well-tested. Implementation, he added, would involve engaging self-help group (SHG) networks and identifying leaders within these groups. Ramann also spoke about the challenges ahead and shared insights into the National Pension System (NPS) and the Old Pension Scheme (OPS). Edited excerpts:

 

How is PFRDA moving forward on Finance Minister Nirmala Sitharaman’s suggestion to explore the possibility of training women as pension sakhis to boost NPS enrolments? 

The Pension Sakhi model, inspired by bima sakhis, is a very important initiative. We’ve been exploring ways to effectively reach the rural segment, and this proposal is both practical and tested. Implementation would involve engaging SHG networks and identifying leaders within these groups — each group typically has a champion or key member. Moreover, the Lakhpati Didi concept can be leveraged.

 

Through these channels, targeted training can be provided to help them understand NPS and its benefits. We plan to work with bank sakhis, or alternatively provide them with pension-specific features. This approach may be faster and more efficient than recruiting an entirely new set of personnel, which can be challenging.

 

Discussions with the Life Insurance Corporation of India indicate that bima sakhis and bank sakhis can also receive incentives and commissions for their role. On the cost side, a committee has been set up to review distribution charges and their further implementation. While most stakeholders acknowledge that NPS is a low-cost product, this minimal cost actually enables faster distribution.

 

Can we expect any changes in the Atal Pension Yojana? 

We’ve started outreach efforts for gig workers through partnership models. Pension funds are reaching out to large platforms — for example, those employing security guards. There are many platform-based and digital gig workers; they form a large part of the informal sector, along with the self-employed.

 

Each group is different — doctors and lawyers are easier to reach; drivers, domestic workers, and plumbers in urban centres are harder. Pension funds have been allowed higher distribution costs to reach these groups and can use media campaigns continuously.

 

Right now, there are no major discussions to revise the scheme. However, a review is carried out every five years.

 

What is the status of OPS amid the entry of the Unified Pension Scheme (UPS) and the existence of NPS? 

Some states, after initially opting for OPS, have switched back to NPS, while others are in the process of doing so and moving towards UPS. OPS is fiscally unsustainable and creates large liabilities for the government. Globally, many countries have shifted from defined benefit to defined contribution schemes, especially after the global financial crisis.

 

Governments need funds for development, and continuously financing rising pensions is not feasible. We believe states will eventually adopt UPS, and we are preparing projections to demonstrate its advantages.

 

The key difference between UPS and OPS lies in the handling of Pay Commission hikes. Overall, OPS remains a costly and unsustainable model.

 

What assets under management do you expect for NPS in 2025–26? 

Growth has been around 28 per cent year-on-year for the past few years. We want to be ambitious and push partners in the ecosystem to increase uptake, especially in the informal sector.

 

The informal sector can grow at a 100 per cent rate — we have to plan big. I’m confident we will exceed 30 per cent growth this financial year.