The New Pension Scheme (NPS) for private citizens may have been launched with a lot of fanfare on May 1, but for the average individual, finding a point of presence (PoP) to open an account is still hard work. Concerned by the limited number of branches delegated by the PoPs for the scheme, the Pension Fund Regulatory and Development Authority(PFRDA) is reviewing their operations and plans to invite more players in six months.
?About 700 PoP branches were scheduled to be opened within the first few days of the NPS launch. But this could not be done as they are having difficulty in getting digital signatures. We have written to the PoPs asking them to do this on a priority basis,? a PFRDA official told FE. While the scheme began with 294 designated branches instead of the proposed 700, their number had risen to 348 by Tuesday. The PFRDA plans to expand the number of designated PoP branches to 1,000 by the end of May and to 3,000 branches in the next three months. PoPs require a digital signature in order to authenticate their fund transfers to the pension fund managers. But without a digital signature, a PoP branch can not start operations for the NPS. As soon as a branch gets a digital signature, it starts opening pension accounts.
What?s more, to ensure that interested subscribers don?t stay away from the scheme because of its limited reach, the PFRDA is also planning to advertise for more PoPs in another six months time. The interim regulator has currently appointed 22 financial entities including Life Insurance Corporation of India, State Bank of India, ICICI Bank, Kotak Mahindra Bank, Axis Bank and Citibank. ?Since the time we have launched the scheme, more banks and financial institutions have shown interest in it. Appointing more PoPs will be a continuous process and will be done every six months,? the official said.
And to ensure that the PoPs work in an efficient manner, the interim regulator is also drafting fresh guidelines for them. Apart from branch expansion, better customer service through timely registration of accounts and transfer of pension contributions to the fund managers would constitute the key elements of these guidelines. PoPs are mandated to transfer contributions received from NPS members to the fund managers on the same day. FE had reported on May 1 that finding a designated PoP branch to open an NPS account was proving to be a difficult task. The PFRDA also received similar feedback from other interested subscribers.