PFRDA working on ensuring pension access for workers in informal sector: Chairperson S Ramann

The latest market report highlights that The Pension Fund Regulatory and Development Authority (PFRDA) is working on a technology-fuelled mechanism to enable workers registered on the e-Shram database to open pension accounts through their mobile phones, its chairperson S Ramann stated on Thursday.

The initiative is aimed at expanding pension coverage among the large informal workforce, a significant proportion of which does not have a regular monthly salary or pay income tax.

"We additionally have a very large database created by the Ministry of Labour on the e-Shram database. It is a well-refined and authentic database containing many of the fields that are already required to open a pension account.

"We are, as a result, looking at how people, who are already registered on the database, can be enabled to open pension accounts through a simple, few-click process on their mobile phones. Once the account is opened, they can use UPI to make contributions to it," PFRDA chairperson Sivasubramanian Ramann stated at Global Fintech Fest 2026 here.

PFRDA has already created NPS Tatkal, which operates through UPI providers, following the government's vision of a UPI-style pension account system, Ramann further noted.

The regulator is now exploring the use of the e-Shram database maintained by the Ministry of Labour to facilitate pension account opening. The database contains many of the fields required to open a pension account, enabling a simplified digital onboarding process.

Once the account is opened, subscribers will be able to make contributions using UPI. The service is additionally envisaged to be available in multiple Indian languages to make pension products easier to understand and access.

Separately, PFRDA is working on a guaranteed-return pension product for the non-government sector, as mandated under its Act.

"We have to work on a guaranteed-return scheme because there is a mandate under our Act," Ramann stated, adding that an expert committee has been constituted to examine possible products.

The key challenge, that stated, is determining who would provide the guarantee for a pension product for non-government subscribers, unlike the Unified Pension Scheme (UPS) for government employees, which has a built-in guarantee mechanism.

PFRDA is additionally preparing to launch NPS Swasthya, with final guidelines anticipated in the next few days and the product likely to be rolled out shortly thereafter.

The product will allow subscribers to use money set aside in their pension account to pay a portion of hospitalisation expenses, while a linked top-up insurance facility would cover the remaining amount.

Ramann stated the top-up insurance could be roughly eight to ten times the initial contribution. The pilot for NPS Swasthya was conducted with two pension funds, while all pension funds should eventually be able to offer the product through tie-ups with insurance firms.

On the investment side, Ramann stated pension funds are already permitted to use equity and interest-rate derivatives for hedging their existing holdings, subject to investment guidelines.

PFRDA is instead looking at innovative bond issuances that could help generate inflation-protected outcomes for guaranteed pension products.

Bank of Baroda has received in-principle approval to set up a pension fund, while four new pension funds have been further noted to the existing 10.

"We have already mentioned this. Bank of Baroda has submitted its application, and in-principle approval has been provided. They should now be in the process of setting up the pension fund. We have four new pension funds in addition to the existing ten pension funds," Ramann stated.