Financial Services Department & PFRDA Should Train Women As 'Pension Sakhis': Finance Minister Nirmala Sitharaman

New Delhi: Emphasising the need for broader pension coverage among the informal and self-employed segment, Finance Minister Nirmala Sitharaman on Wednesday asked the Department of Financial Services and PFRDA to explore the possibility of training women as 'Pension Sakhis' to deepen social security coverage.

Speaking about the future of pensions, the finance minister said broadening coverage to the informal, self-employed, and platform or gig workforce by simplifying onboarding, offering local language interfaces, and enabling doorstep e-KYC can make the enrolment process quick and easy.

There is a need to deepen women's pension security through workplace auto-enrolment, contribution continuity during maternity and caregiving breaks and micro auto-debits, which will keep small, regular savings from lapsing, she said on the occasion of NPS Diwas here.

"I want the DFS and Pension Fund Regulatory and Development Authority (PFRDA) to explore the possibility of training women as 'Pension Sakhis' and incentivise them for sustained increase in enrolment, much like 'Bima Sakhis' done by LIC," she said.The minister also urged promoting financial literacy early in schools, ITIs, colleges and community centres - so that households begin their contributions in their 20s and just before 30s. The National Pension System (NPS) should turn into a true 'Jan Andolan'.

She stressed that the focus should be on keeping the cost low and improving service quality, with time-bound, digital-by-default grievance redressal, clear disclosures and portability that works seamlessly across products and platforms.Keep the system fiscally sustainable by aligning contributions, prudent asset allocation and inflation-aware benefits so pensions remain reliable across economic cycles, Sitharaman said.

Observing that the growth of any nation depends on the robustness of the social security framework, she said that innovative pension and retirement solutions will help address the supply and demand from the industry and from the consumer side.Pointing out the schemes under the NPS have generated attractive returns, she said the average annual returns since inception for equity schemes have been over 13 per cent, and 9 per cent for the Corporate Debt scheme and Government Securities scheme.

NPS is one of the lowest-cost pension fund management schemes in the world, and lower costs mean more money stays invested and grows, the minister said.In the Budget 2025-26, it was announced that a forum for regulatory coordination and development of pension products will be established.Accordingly, she said, in August 2025, "We have set up the 'Forum for Regulatory Coordination and Development of Pension Products'. It brings together PFRDA, EPFO, IRDAI, SEBI, and relevant ministries".

The main aim of the forum is to develop a common regulatory and supervisory framework, investment standards across pension products, strengthen consumer protection, grievance redressal and ensure robust systemic risk management of assets under management, Sitharaman added.The Multiple Scheme Framework (MSF) will be effective on October 1, the finance minister said.

Non-government NPS subscribers will be able to allocate up to 100 per cent of their funds in equities, she said, adding that each scheme will have moderate and high-risk variants, with equity exposure permitted up to 100 per cent, compared to the current 75 per cent in high-risk options.An investor would be able to choose the new schemes under MSF without needing to invest in the "common schemes", the old schemes of various pension funds, she said.

Non-government subscribers can also opt for multiple schemes across different CRAs (central recordkeeping agencies) under a single Permanent Retirement Account Number (PRAN), the minister said.This will cater to different investor preferences, giving them greater flexibility, she added.Furthermore, she said, the cost structure remains low, capped at 0.3 per cent of assets under management (AUM) annually, with an additional 0.1 per cent incentive for PFs that bring in new subscribers.

For subscribers, the MSF represents a major expansion of choice and personalisation.Speaking at the occasion, Financial Services Secretary M Nagaraju said India's investment in pension plans continues to be low, with more inflows going into other savings instruments."The government has created adequate room for the pension sector to grow, and now, we need to look at ways in which more inflows can be directed towards pension savings," he added.

In the current financial year, there have been dual tax bonanzas in the form of income tax relief announced in the Budget for 2025-26 and the recent sweeping Goods and Services Tax reforms.Both moves are expected to result in savings of over Rs 2.50 lakh crore annually, Prime Minister Narendra Modi had said.These reforms will help deepen the pension sector, Nagaraju said, adding that higher disposable income will mean more savings, which could be directed towards pension plans.

Chief Economic Adviser V Anantha Nageswaran, who was also at the event, said the government is making all efforts, including structural reforms like GST rate rationalisation, to boost the domestic economy amid exogenous pressures. The government's reforms are directed at boosting savings in the economy.According to data from the NPS Trust, the total assets under management under the National Pension System were Rs 15.48 lakh crore as of August 31.

Nagaraju said that while efforts are in place to popularise pension plans and improve their penetration in the economy, challenges persist.A key challenge relates to prudent pension fund management, he said, without going deeper into the subject.He also said fund managers and the PFRDA must look to launch newer, more bespoke products to accommodate the evolving needs of the sector.Subscribers from the informal and the non-government sectors also need to be added to the National Pension System, he said.

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