PFRDA would allow Subscriber to Invest upto 75% in Equity Market

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PFRDA stands for Pension Fund Regulatory and Development Authority. In India PFRDA regulates the all the Pension schemes. In a recent development Pension Fund Regulatory and Development Authority (PFRDA) is planning to launch two new schemes for their subscribers. Through these schemes the subscribers would be able to do maximum investment upto 75% in the equity market. The nature of the two schemes would be aggressive and conservative. PFRDA is planning to launch these two schemes by the end of this month.

PFRDA would allow Subscriber to Invest upto 75% in Equity Market.For this two scheme would be launching in this month.In first maximum 75% of the deposit is allowed to do investment in equity market.In second maximum 25% the deposit is allowed to do investment in equity market.

PFRDA Aggressive Investment Option:

According to Pension Fund Regulatory and Development Authority chairman Hemant Contractor, in the aggressive investment scheme the subscribers would be allowed to do a maximum investment of 75 % of the deposit amount in the equity market .This thing would be allowed at the starting stage. This investment limit would be reduced over a period of time as the investor age go on increasing.

PFRDA Conservative Investment Option:

 Further According to Pension Fund Regulatory and Development Authority chairman Hemant Contractor, in the conservative investment scheme the subscribers would be allowed to do a maximum investment of 25 % of the deposit amount in the equity market .This thing would be allowed at the starting stage. This investment limit would be reduced over a period of time as the investor age go on increasing.

Present Percentage of Investment in Equity Market:

According to contractor in the present time the subscribers are allowed to 50% of their deposit to do investment in equity market. However, according to PFRDA the overall return on this investment is around 11.5 %.

Return by non-government subscriber & government subscriber:

The rate of return by the investment made by the non-government subscriber is slightly higher than the return by the investment made by the government subscribers. Non-government subscribers are making 13% returns whereas government subscribers are making only 9.5%. A government subscriber includes the government employees.

Allowed Percentage in Equity Market:

The reason of different in return generated by non-government subscriber & government subscriber is due to their limit in investment in equity market. Government employees are allowed to do a maximum investment of 15% of their deposit in the equity market, whereas non-government subscribers are allowed to 50% of their investment in the equity market.

Percentage of government employee investment limit to increase:

According to contractor they are planning to allow government employee to increase their investment limit from 15% to 50%. The matter is still pending.

NPS:

NPS stands for national pension scheme. This scheme is regulated by Pension Fund Regulatory and Development Authority (PFRDA). In the initial days of launching only Government employees were allowed to do investment in this scheme, but later on non-government employee i.e. employee from private sectors were also allowed to do investment in this scheme.

In the present time PFRDA is having 1.3 crore subscribers which includes 44 lac government employees and rest from the private sector. Total corpus collected by government employees is Rs 14,000 crore.

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