Tata AMC enters pension fund management business


Tata Pension secured a license for pension fund management and started operations on 19 August 2022. However, the management hasn’t yet secured a license for National Pension System (NPS) distribution  which some other pension fund managers have. Kurian Jose, CEO of Tata Pension Management Ltd, speaks to Mint about the company’s pension fund business plans. 


What is your plan for NPS? 

We got the certificate of registration on 1 February, and we went live from 19 August. Currently, we are allowed to inform and educate, so we have our website in place, tatapension.com. Right now, the idea is to manage the money that comes to us. 

Do you have a PoP license? 

No, we only have the Pension Fund Management (PFM) license. We can actively sell once we secure a point of presence (PoP)  license. Since Tata pension management is a 100% held subsidiary of Tata Asset Management Private Ltd, as an asset manager, we would like to get the PoP license from NPS and PFRDA. We are awaiting regulatory clearances. 

How much time do you think it is going to take? 

We have all the checkboxes in place. We only need some regulatory clarity on some things. Once that is done, we should apply soon. 

Looking at the investment side of it, how would you distinguish yourself from your peers? 

We want to ensure that the long-term capital is protected. We do not want to take any risks regarding the money we manage. According to the guidelines, we can invest only in top 200 companies by market cap. 

Are there any reforms you want to see that can help NPS penetration in India? 

Globally, you generally have one regulator who monitors the financial services. In India you have multiple regulators managing different domains, and they all have different spectrums.

The one thing that the pension trust wants to do is expand this particular assets under management (AUM). If you look at the mutual fund space, it’s about 36-37 trillion. And obviously, it’s been around since 1964, when Unit Trust of India started. The NPS space is currently at about 7.5 trillion and growing.  Besides, for timing penetration, you need partners, agents, distributors and advisors. What’s most important here is to incentivize people to come, and sell this particular product.

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