Pension as mandatory savings

It is useful to understand what low pension coverage means

Pension as mandatory savings

PENNY WISE: On the subject of voluntary savings, the question is whether people save enough and not whether they save through plans called pension

Renuka Sane
The Reserve Bank of India committee on household finance (Ramadorai Committee) has commented on the low pension participation of Indian households. This is something that several committees constituted by the Pension Fund Regulatory and Development Authority (PFRDA) have also worried about. The Ramadorai Committee as well as the PFRDA committees have suggested increasing the incentives of distributors (and fund managers) to incentivise people to join the National Pension System (NPS). But before we tinker with the basic framework and philosophy behind the NPS, it is useful to agree on what low pension coverage means and the place of the NPS
Disclaimer: These are personal views of the writer. They do not necessarily reflect the opinion of or the Business Standard newspaper

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First Published: Sep 05 2017 | 10:39 PM IST

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