The Pension Fund Regulatory and Development Authority (PFRDA), which operates the National Pension System (NPS), is planning to launch a guaranteed return scheme, Minimum Assured Return Scheme (MARS).
- The PFRDA has appointed EY Actuarial Services LLP as a consultant to help design the proposed MARS under the NPS. This will be the first scheme from the pension regulator that will offer a guaranteed return to investors.
Salient Features
- The scheme will provide savers and people from the salaried class an option for their investments.
- The actual returns will depend on the market conditions. Any shortfall will be made good by the sponsor, and the surplus will be credited to the subscribers’ account.
- The whole idea behind having MARS is to have a separate scheme that can offer a guaranteed minimum rate of return to NPS subscribers, especially those who are risk averse. Currently, the NPS gives returns annually, based on prevailing market conditions.
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