Overview
The Pension Fund Regulatory and Development Authority (PFRDA) is India’s statutory pension sector regulator, responsible for regulating, promoting, and ensuring orderly growth of the pension system in the country. It plays a central role in expanding pension coverage and safeguarding the interests of subscribers.
PFRDA regulates the National Pension System (NPS) and Atal Pension Yojana (APY), which together form the backbone of India’s contributory pension architecture.
Establishment and Legal Status
- PFRDA was established in 2003 through an executive order.
- It became a statutory body in 2014 with the enactment of the PFRDA Act, 2013.
- It functions under the administrative control of the , Government of India.
- Headquarters: New Delhi
Objectives
PFRDA aims to:
- Promote old-age income security by developing pension systems
- Extend pension coverage to all citizens, especially the unorganised sector
- Ensure financial sustainability, transparency, and efficiency in pension management
- Protect the interests of pension subscribers
Core Functions
Regulation of Pension Schemes
PFRDA regulates and supervises:
- National Pension System (NPS)
- Atal Pension Yojana (APY)
- Other pension schemes not regulated by any other statutory authority
Oversight of Intermediaries
It regulates and licenses:
- Pension Funds (PFs)
- Central Recordkeeping Agencies (CRAs)
- Custodians
- Trustees
- Points of Presence (PoPs)
This ensures proper fund management and operational integrity.
Subscriber Protection
- Prescribes investment guidelines and risk norms
- Ensures disclosure standards and grievance redressal mechanisms
- Monitors compliance and penalises violations
Developmental Role
- Encourages innovation and competition in the pension sector
- Promotes financial literacy and pension awareness
- Supports digitisation and simplification of pension onboarding
Composition of PFRDA
The authority consists of:
- A Chairperson
- Three whole-time members
- Three part-time members
Members are appointed by the Central Government.
Importance of PFRDA
- Strengthens India’s social security framework
- Encourages long-term savings and capital market development
- Reduces future fiscal burden of old-age welfare
- Supports demographic transition towards an ageing population
