Appointment of CRA, PFMs in next 3 months: PFRDA

New Delhi, Feb 5: The Pension Fund Regulatory and Development Authority (PFRDA) will appoint the Central Record Keeping Agency (CRA) and Pension Fund Managers (PFMs) within the next three months to implement investment of NPS corpus in security markets, as per the recent government decision.

''We have invited expressions of interest (EoIs) from public sector data management institutions. The last date for submission of EoIs is tomorrow, after which we will examine them and appoint the CRA and PFMs within the next three months,'' PFRDA Chairman Dhirendra Swarup today said at a seminar on 'Indian pension fund industry: the way forward' organised by Assocham here.

The government had last month announced its decision to notify investment of five per cent of the New Pension Scheme (NPS) corpus in the markets.

The employees of Central and 19 supporting state governments presently hold Rs 1,500 crore in the NPS corpus.

The PFRDA has fixed a minimum capital requirement for the CRA as Rs 50 crore. The requirement for the fund managers can be anything between Rs 10 crore that SEBI has prescribed for asset management firms and Rs 100 crore by Insurance Regulatory and Development Authority (IRDA) for insurance firms. ''The picture will be clear only when the PFRDA bill is passed by Parliament,'' Mr Swarup said.

Initially, CRA and fund managers will be appointed only out of public sector firms, but once the regulations come into effect post the passing of the bill, even private companies may be allowed to come in, he added.

Public sector undertakings like SBI, UTI, PNB, LIC and NSDL can be apponited as fund managers as they pass the eligibility criteria.

Dismissing concerns expressed over the risk involoved in such a scheme, Mr Swarup said, the investment of NPS corpus -- expected to reach 43-billion-dollar mark in the next 10 years -- can give assured returns depending on the investment options being exercised.

''We have done some simulation assuming that the money had got invested in January 2004, when the new scheme came into effect. Our estimates indicate that the subscriber would have earned returns ranging between 14 per cent to 29 per cent per annum in nominal terms depending on the investment options chosen,'' he said.

The government securities, where the amount is currently invested, gives a return of eight per cent per annum.

UNI