Retirement Income Optimization through Multiple Annuities
Contents News/Article Date: 10th May 2023
Relating to which Act: NPS is now regulated under PFRDA Act, 2013 and regulation framed thereunder by Department of Financial Services and PFRDA. Under the NPS, every Government servant is registered and allotted a Permanent Retirement Account Number (PRAN)
Penalty under the Act: Power of Authority to ensure compliance. —If the Authority finds, after causing an inquiry to be made, that any person has violated, or is likely to violate, any provisions of this Act, or any rule or regulation made thereunder, the Authority may pass an order requiring such person to cease and desist from committing or causing such violation.
Applicable to which State: Whole of India
Type: Pension Fund Regulatory and Development Authority Circular No. PFRDA/2023/14/SUP/ASP/02 dated 10th May 2023 issued by Chief General Manager
Pertains to: (e) “individual pension account” means an account of a subscriber, executed by a contract setting out the terms and conditions under the National Pension System;
Relevance of this news: Karma Global is in the business of HR Services, Payroll, Outsourcing and Regulatory Compliances right from its inception in 2004 and since then, has brought in a lot of efficiencies and technological upgradations with experts on its roll, to ease the hassles of Payroll Processing, Temp Staffing, On-boarding, Employee Life Cycle, Statutory, Regulatory and Payroll compliances by providing customized solutions to all its elite clients.
Now Karma Global is also fully into labour compliances for nearly 18 years and is helping both establishments and workers for fulfilment of obligations as per the laws of the land. It has over 200 staff, both direct and indirect on its rolls and operates on pan India basis. Recently, it has diversified into foreign shores as well, into countries like US, UK, UAE, Canada, Philippines, and Asia for handling payroll, outsourcing, recruitment and governance.
And in the current instance: Under NPS, the immediate annuities are made available to the subscribers by Annuity Service Providers (ASPs) under the enabling provisions of Exit Regulations of PFRDA. At present, the subscribers are allowed to buy one annuity scheme from the ASP at the time of exit.
- In the interest of subscribers’ retirement income optimization and to provide them with a wider range of annuity options, PFRDA is pleased to inform that the choice of multiple annuities from the same ASP will be made available.
- The option of multiple Annuities shall be provided for those Subscribers who earmark the annuity corpus more than Rs 10 lakhs wherein Rs 5 lakhs utilized to buy each annuity scheme.
- In this regard, CRAs are advised to build the necessary system-level functionality to facilitate the implementation of this change. Until this feature is developed, ASPs can handle the requests for multiple annuities received from subscribers and provide the necessary information to CRA through Reverse Information Flow.
Subject: Retirement Income Optimization through Multiple Annuities
Attached is the notification