Outlook Money 40After40: Every Citizen Must Be Financially Secure As India Moves Towards Viksit Bharat, Says PFRDA Chairman S. Ramann

Every Indian, regardless of their income levels and age, needs a retirement plan, S. Ramann, Chairman, Pension Fund Regulatory and Development Authority (PFRDA), said at the IDFC First Bank presents Outlook Money’s 40after40 Retirement Expo on February 20, 2026. To this end, the pension fund regulator is looking at ways to integrate digital payments systems with pension funds so that citizens can plan and invest for their retirement with ease, he said.

“We must cater to every segment of society. Over the next 20 years, as we move towards Viksit Bharat, we must ensure that citizens are financially secure, standing on their own feet, not dependent on handouts or subsidies,” Ramann said.

PFRDA Extending Pension Access across Socio-Economic Classes

He said PFRDA is working to extend the access of national pension schemes across socio-economic classes.

“Creating a stable corpus for farmers, micro, small and medium enterprise (MSME) workers, gig workers and underserved populations is key to developing the financial health and security of every citizen in the country. There are 45,000 farmer-producer organisations (FPOs) in the country, many with 1,000-2,000 members. It requires effort and expenditure, and we are committed to putting both in place. Similarly, we are engaging with MSME clusters — there are around 350 such clusters with countless workers, whether employer, employee, or contractual labour,” he said.

PFRDA Has Brought More People Into Pension

He said over the last 15 years, PFRDA has been able to bring more people into the fold of creating pension schemes. “Today, the pension account under the National Pension System (NPS) is a very flexible account. We have restructured the concept of a pension account. What is applicable to government officials may not necessarily be applicable to other citizens. With this clarity, we have brought about several reforms in recent months,” he said.

Ramann said that individuals are no longer bound to the concept of a rigid work-life system and retirement at 60 years of age. More people today identify with the financially independent, retire early (FIRE) movement. Individuals are now shifting their focus on creating long-term wealth and manage their finances according to future cash needs, he said.

“Our research shows that the power of compounding works significantly over 15 years — and of course, even more over longer periods. Therefore, whether you are 25 or 55, our message is simple: hold your money in your account, let it grow, and you will see tangible wealth creation,” he said.

NPS Subscription From Non-Government Sector Remains Low

Nevertheless, NPS subscription from the non-government sector remained abysmally low at only around 7.60 million. As such, PFRDA is encouraging digital journeys through pension funds and central record-keeping agencies (CRAs) to bridge this gap. By strengthening digital distribution, PFRDA also aims to lower costs on onboarding customers while increasing reach, Ramann said.

Financial Education Important to Create Awareness about Pension

Ramann said that while the age of 60 remains important for both government and private sector employees due to employment frameworks, only around 10 per cent of the workforce is employed in the organised sector.

“There is an increasing desire for individuals across rural and sub-urban locations to invest and earn income effectively. However, in order to create a safe and secure pension fund system, large-scale financial education is needed. For this purpose, PFRDA is reaching out to institutions and partners to create more awareness along with building an effective distribution system,” he added.

Returns on NPS

He said that since NPS is a voluntary investment scheme, it must provide return on investment to attract more people. To that extent, even the most conservative government schemes under NPS have given around 9.30 per cent returns annually over the past 12-13 years and equity schemes have given nearly 18 per cent returns in some cases, he added.

“On investment returns, depending on asset class… NPS delivers between nine per cent and 18 per cent. But is this sustainable? We hope Government security (G-sec) yields stabilise. Pension funds invest significantly in G-secs,” he said.

He added that in addition to G-secs, PFRDA has also allowed 1 per cent of the assets under management (AUM) to be invested in venture capital and private equity, which has delivered around 18-30 per cent of returns over the past decade. This benefits long-term investors whose horizon aligns with private equity, he said.

Expert Committee to Explore Asset Diversification

He said PFRDA has also set up an expert committee to further explore asset diversification. “Foreign pension funds investing in India earn attractive returns. Indian pension funds must also adopt strong governance, risk measurement, and execution standards and explore new asset classes in a calibrated manner,” he said.

Digital Outreach and Integration

Ramann added that in addition to returns on investments, it is also important for PFRDA to evolve in the digital and technology space to reach a wider investor base and promote ease of investments. To this extent, PFRDA is working with the National Payments Corp of India (NPCI) to create a gateway to simplify onboarding for investors.

“Very soon, as a Unified Payments Interface (UPI) user, you may receive a nudge from your provider — PhonePe, Google Pay, Paytm — asking, “Do you have an NPS account?” We are working with NPCI to create a gateway where UPI users without pension accounts receive education and a simple onboarding journey,” Ramann said.