PFRDA Notifies Simplified Rules for Pension Funds, NPS Trust
Moneylife Digital Team 21 February 2024
The Pension Fund Regulatory and Development Authority (PFRDA) has notified the amendments to the regulations of the National Pension System (NPS) Trust and the Pension Fund to reduce the cost of compliance and enhance the ease of doing business. As per the official statement issued on Wednesday, the National Pension System Trust (Second Amendment) Regulations 2023 and Pension Fund (Amendment) Regulations 2023 have been notified on 5th February and 9 February 2024, respectively.
The amendments to the NPS Trust Regulations focus on simplifying provisions related to appointing trustees, their terms and conditions, conducting board of trustees meetings and appointing the chief executive officer (CEO). These changes aim to enhance operational efficiency and governance within the NPS Trust framework.
Similarly, amendments to the Pension Fund Regulations align the governance structure of Pension Funds with the Companies Act, 2013 while also emphasising enhanced disclosure requirements. Key amendments include clarifying the roles of pension fund sponsors, ensuring compliance with 'fit and proper person' criteria, constituting additional board committees such as audit and nomination & remuneration committees, and mandating the inclusion of pension fund in the name clause.
Furthermore, pension funds are required to ensure compliance with these provisions within a specified timeframe, demonstrating the regulator's commitment to bolstering transparency and accountability in the pension industry.
These regulatory changes have come in response to the Union Budget 2023-24 directive to review regulations to reduce the cost of compliance and improve the ease of doing business. By simplifying procedures and enhancing governance standards, PFRDA seeks to foster a conducive environment for growth of the pension sector while safeguarding the interests of pension scheme subscribers.
Details of the aforementioned amendments have been published on the PFRDA website. 
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