Mumbai / Delhi: Authority Arrangement of Pension Funds and Development Authority (PFRDA) cannot be in a hurry to allow fund managers to invest in startup, the top official said on Tuesday.
Recent authorities allowed fund managers to participate in the company’s initial public offering (IPO) with the minimum size of RS 500 Crore.
In addition, post-IPO assessments must place them among 200 registered companies.
“The biggest challenge for us is that we need a daily NAV (clean asset value) on all investments, such as mutual funds, and it might not be possible with startup.
In addition, there are challenges related to the assessment,” said PFRDA Chair Supratim Bandyopadhyay in a briefing media.
On Monday, the government has suggested that the Provident CIC fund organization and employees can invest in startup, plans where the EPFO section does not fully rise.
While the Head of PFRDA did not rule out the possibility, he suggested caution.
Relaxation of the IPO comes at the time of the average market with National Pension Offers and Schemes (NPS) has recorded a milestone of the history of 30 non-government retail accounts with RS 97,000 Crore Management Assets.
Including government accounts, PFRDA has assets under the management of Rs 6.4 lakh Crore – Increasing 31% from Rs 4.9 Lakh Crore last year.
Bandyopadhyay said that the regulator will not enter the company’s assessment that IPO and investment will be completely a call from the fund manager.
He said that the current head room for investment under qualified institutional bidders was sufficient because only 14% corpus government employees invested in equity.
Pension regulators say that in the last 12 years, PFRDA’s equity investment has resulted in a compound annual growth rate of 12.9% as to 9.9% for corporate bonds and 9.4% for government securities.
However, the return of full life annuities by life insurance companies ranges from 5.25% and 6% and can change.
Bandyopadhyay said that the insurance regulator was in the discussion to allow the product of an annuity related to inflation and this would make retirement more attractive.
PFRDA has waved the request of a proposal from the consultant to help design a minimum return scheme that is guaranteed under NPS.
The regulator has decided to extend the last date because the bidder said that it was difficult to fulfill the conditions that require experience in designing similar products for India.
PFRDA is also in talks to increase attendance points (POPs) who have the right to distribute NPS products.
“We now have Fintech such as Banyan Tree, Etmoney, Paytm and Zerodha which can provide digital channels to end to retire.
For semi-urban customers, we allow individuals to be registered as Pops under the pops that exist as Last-Mil Connectivity is very important , “said Bandyopadhyay.
Etmoney is part of the Times group.
PFDA is aware of the investment of retirement funds in startup
