NEW DELHI: The Centre will soon set up the forum for regulatory coordination and development of pension products and expects all key players in the sector to be part of the entity. Finance minister Nirmala Sitharaman had announced the setting up of the forum in her 2025-26 Budget. The forum may be modelled on the lines of the Financial Stability and Development Council (FSDC).
The FSDC, chaired by the FM, deals with issues linked to financial stability, financial sector development, inter-regulatory coordination, financial literacy, financial inclusion and macro prudential supervision of the economy, including the functioning of large financial conglomerates. Work on setting up the entity and the structure is likely to kick start soon.
The new entity is likely to be chaired by the chairman of Pension Fund Regulatory and Development Authority (PFRDA) and will have representatives from all pension players, including the EPFO (Employees Provident Organisation). Pension funds managed by Trusts would most likely be represented through the Central Board of Direct Taxes with whom they are registered, officials say.
The forum is expected to play a coordinating role to develop common minimum supervisory reporting formats, raise consumer protection standards and undertake comprehensive market development projects.
It is also expected to create awareness for securing the future of people by investing in pension assets. The need to create awareness about pension schemes has gathered urgency as by 2050, the country’s median age and those above the age of 60 is expected to increase sharply. Authorities say that supporting this large pool of people would be an important aspect of providing social security.
“This needs creation of financial buffers in the nature of pension assets. The forum will facilitate maintenance of robust regulatory oversight and development of pension assets,” according to a govt document explaining the Budget provisions. It says the forum will improve consistency across regulators, enhance consumer protection, support market development and ensure adequate pension coverage.