Regulation – Fund Management (PF, Custodian, NPS Trust)

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Overview - Pension Fund Management

The Fund Management Regulation Department of PFRDA plays a key role in overseeing the registration, governance, and regulatory compliance of pension funds under the National Pension System (NPS) in compliance with the PFRDA Act, the Rules & Regulations issued thereunder, and other guidelines/ circulars/ directives issued by the Authority.
The department is responsible for policy formulation, proposal evaluation, and legal coordination to safeguard the interests of NPS subscribers. By implementing strict regulatory frameworks, it ensures efficient fund management, investor protection, and the long-term sustainability of pension funds. 
 
Key Functions

1. Pension Fund Registration & Compliance

  • Selection, registration, renewal, and cancellation of pension funds.  

2. Regulatory Oversight

  • Implementation of PFRDA (Pension Fund) Regulations and policy amendments.  

3. Policy Development & Clarifications

  • Guidelines for Pension Funds, NPS Trust, and intermediaries, along with clarifications on circulars.  

4. Fee Structure & Agreements

  • Determination, collection, and review of fee structures and agreement formats.  

5. Proposal Evaluation

  • Assessment and recommendations for policy decisions.  

6. Legal & Board Activities

  • Management of legal cases, interdepartmental coordination, and Board agenda preparation.

Overview - Custodian

The Fund Management Regulation (Custodian) Department of PFRDA is responsible for regulating custodians of securities within the National Pension System (NPS). It ensures that custodians operate in accordance with PFRDA regulations, maintaining transparency, security, and efficiency in handling pension fund assets.  
By overseeing registration, compliance, and policy development, the department ensures a well-structured custodial framework that safeguards subscriber investments and upholds regulatory standards in pension fund management.  

Key Functions

1. Selection & Registration

  • Registering, renewing, and canceling certificate of registration granted to custodians of securities. 

2. Regulatory Compliance

  • Ensuring adherence to PFRDA regulations and implementing necessary amendments. 

3. Policy Issuance & Review

  • Developing and reviewing guidelines for custodians to maintain best practices in fund management.   

Overview - NPS Trust

The Regulation - Fund Management (NPS Trust) Department of the Pension Fund Regulatory and Development Authority (PFRDA) is dedicated to overseeing the regulatory activities related to the NPS Trust. This department plays a crucial role in ensuring the establishment, governance, and effective functioning of the NPS Trust, which is integral to the National Pension System (NPS). The department ensures that arm’s length distance is maintained and the NPS Trust operates independently while adhering to the regulatory framework set by PFRDA.
The department is responsible for appointing trustees and the chairperson, issuing and reviewing policies, and providing necessary clarifications on guidelines and circulars. It also prescribes formats for information and agreements, evaluates proposals, and handles inter-departmental communications. Through its comprehensive regulatory oversight, the department ensures that the NPS Trust operates transparently and efficiently, safeguarding the interests of all stakeholders involved in the NPS.

Key Functions

1. Establishment of NPS Trust

  • Setting up the NPS Trust as an intermediary on an arm’s length basis.

2. Appointment of Trustees and Chairperson

  • Appointing trustees and the chairperson on the Board of NPS Trust.

3. Regulatory Activities

  • Managing activities related to PFRDA (NPS Trust) regulations and amendments.

4. Policy Issuance and Review

  • Issuing and reviewing policies, guidelines, and instructions for the NPS Trust.

5. Clarifications

  • Providing clarifications on guidelines, policies, and circulars.

6. Information Formats

  • Prescribing formats for information and agreements.

7. Proposal Evaluation

  • Evaluating proposals and submitting comments on behalf of the Authority to various committees and stakeholders.

8. Inter-Department Communications

  • Handling communications between departments.

9. Board Agenda Preparation

  • Preparing Board agenda items and submitting action taken reports (ATR) to the Board Secretariat.

10. Other Responsibilities

  • Performing additional tasks as assigned by the Head of Department (HOD), Whole Time Member (WTM), or Chairman.