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Monday, October 25, 2021

Important news for NPS subscribers! PFRDA hikes investment management fees

The Pension Fund Regulatory and Development Authority (PFRDA) has increased the investment management fees charged by pension funds in the National Pension System (NPS).

The Pension Fund Regulatory and Development Authority (PFRDA) has increased the investment management fees charged by pension funds in the National Pension System (NPS). This increased fee will be applicable from 1 April 2021. The fund management fee, which was 0.01 per cent of the asset, will now go up. But the limit will be kept at 0.09 per cent of the total asset under management of the pension fund, which will depend on the total asset under management of the pension fund. Separate slabs of management fees will apply to AUMs (asset under management) under the revised revenue structure for pension funds.

According to these slabs, for AUMs up to Rs 10,000 crore, the maximum investment management fee will be 0.09 per cent. From Rs 10,001 to Rs 50,000 crore, fees are limited to 0.06 per cent, Rs 50,001 to Rs 1,50,000 crore at 0.05 per cent, and for AUMs that cross Rs 1,50,000 crore, management fees will be 0.04 per cent.

According to the notice to subscribers, the new slab based structure will be applicable for pension funds for which PFRDA has issued new registration certificates on 30 March 2021.

SBI Pension Funds

Up to Rs 10,000 crore: 0.09% per annum
10,001-50,000 crores: 0.06% annually
50,001 – Rs 1,50,000 crore: 0.05% per annum
1,50,000 crores and above: 0.03% annually

LIC Pension Funds

Up to Rs 10,000 crore: 0.09% per annum
10,001- 50,000 crore: 0.06% per annum
50,001 – Rs 1,50,000 crore: 0.05% per annum
1,50,000 crores and above: 0.03% annually

UTI Retirement Solutions

Up to Rs 10,000 crore: 0.07% per annum
10,001-50,000 crores: 0.06% annually
50,001-1,50,000 Crore: 0.05% per annum
1,50,000 crores and above: 0.03% annually

HDFC Pension Management

10,000 crores: 0.09% annually
10,001-50,000 crores: 0.06% annually
50,001-1,50,000 Crore: 0.05% per annum
1,50,000 crores and above: 0.03% annually

Auto Loan: Banks charge 2.5-3 lakhs interest on 8 lakhs, make up for the loss with SIP within the loan period itself

ICICI Prudential Pension Funds

Up to Rs 10,000 crore: 0.09% per annum
10,001-50,000 crores: 0.06% annually
50,001-1,50,000 Crore: 0.05% per annum
1,50,000 Crore and above: 0.03% per annum

Investment management fees charged by pension funds under all schemes The total will be on AUM and is charged on a daily basis.

(Story: Sunil Dhawan)

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Nisha Chawlahttps://www.businesskhabar.com/
She is an expert in Banking, Finance and working with an international bank. She sharing her ideas and knowledge with Business Khabar.
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