Pension Fund Regulatory and Development Authority is established under the PFRDA Act which was passed on 19.09.2013 in the parliament and notified on 01.02.2014. PFRDA is regulating the National Pension scheme.
Contributory Pension Scheme notified by the central government on 22.12.2003 was renamed as National Pension System w.e.f 01.01.2004 for all the central government employees except the employees of the armed forces. Subsequently the same scheme was extended to all the citizens of india w.e.f 01.05.2009. This scheme abolishes the old pension system being managed by the Provident fund under the accountant general of india. After passing of the PFRDA Act, NPS got the legal status with retrospective effect from 01.04.2004.
Contibutory Pension scheme is being continued by the state government to have control over the subscription of the state government employees. The money collected under the scheme is supposed to be transferred to the NPS account opened on behalf of the employee as prescribed by the PFRDA norms.
Central Record Keeping Agency:
- NSDL(National Securities Depository Ltd) is supposed to be the Central Record Keeping Agency, which will maintain the accounts of the NPS and give IT back end support.
- M/s Karvy Computershare Private Limited is recently been authorised to act as a Central Record Keeping Agency.
Pension Fund Managers:
Pension Fund Managers were appointed for managing funds collected under the scheme. They are authorized to invest the money in the capital market as per the option selected by the contributors.
At present there are 7 pension fund managers approved by the PFRDA, one of which can be selected by the contributor of his choice.
Any individual can open a NPS account electronically without any paperwork using Aadhar based authentication. The procedure is very simple which is explained in the picture.