PFRDA eyes e-Shram route to bring informal workers into pension fold

New Delhi: The Pension Fund Regulatory and Development Authority (PFRDA) is looking to use the e-Shram database to simplify pension account opening for informal workers, allowing them to enrol through a few clicks on their mobile phones and contribute through UPI.

The proposed mechanism seeks to widen pension coverage among workers who often lack a regular monthly salary and fall outside the income-tax-paying population, PFRDA Chairperson Sivasubramanian Ramann said on Thursday.

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Speaking at the Global Fintech Fest 2026, Ramann said the Labour Ministry’s e-Shram database already contains several details needed to open a pension account, providing a foundation for simpler digital onboarding.

“We are, therefore, 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,” he said.

The initiative builds on NPS Tatkal, which PFRDA has already created to operate through UPI providers. The proposed service is also envisaged in multiple Indian languages to help workers understand and access pension products.

Guaranteed-return product under examination

Separately, PFRDA has constituted an expert committee to examine a guaranteed-return pension scheme for non-government subscribers, as required under its Act.

A central question is who would provide the guarantee. Ramann said this distinguishes the proposed product from the Unified Pension Scheme (UPS) for government employees, which has a built-in guarantee mechanism.

“We have to work on a guaranteed-return scheme because there is a mandate under our Act,” he said.

The regulator is also examining innovative bond issuances that could help deliver inflation-protected outcomes for guaranteed pension products.

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NPS Swasthya guidelines expected shortly

PFRDA is preparing to launch NPS Swasthya, with final guidelines expected in the next few days and a rollout likely shortly thereafter, Ramann said.

The product would allow subscribers to use money set aside in their pension account to meet part of their hospitalisation expenses, with a linked top-up insurance facility covering the remaining amount.

Ramann said the top-up insurance cover could be roughly eight to ten times the initial contribution. Two pension funds participated in the pilot, and all pension funds should eventually be able to offer the product through partnerships with insurers.

On investments, he said pension funds are already permitted to use equity and interest-rate derivatives to hedge existing holdings, subject to investment guidelines.

Ramann also said Bank of Baroda has received in-principle approval to establish a pension fund and should now be working towards setting it up. Four new pension funds have been added to the existing 10, he added.

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