DSP Pensions, the latest entrant into the Pension fund management industry, wants to be a “significant player” in this space and not just be the 11th player, its Chief Executive Officer Ràhûl Bhagat has said.
Pension regulator PFRDA on Wednesday granted the certificate of registration to DSP Pensions, making it the country’s 11th pension fund manager of NPS.
“We want to be a significant player in the pension fund management industry. We just don’t want to be the eleventh player in the industry. DSP is very good brand name in the industry and we want to build on that and become a household name through National Pension System (NPS)”, Bhagat told businessline.
“Yes, we have now received the certificate of registration for DSP Pensions”.
DSP Pensions is now just a step away from commencing its business and is expected to soon get the Commencement of Business certificate from the pension regulator. “We hope to commence operations by mid-October”, Bhagat said.
Last year, PFRDA gave the DSP Investment Managers a licence to undertake pension fund management business.
This licence had been given to DSP Investment Managers as a Sponsor of a pension fund. Now, the PFRDA has issued the certificate of registration to the Pension Fund (DSP Pensions) as the 11th Fund Manager of NPS.
Bhagat also said that DSP Pensions would look for a Points of Presence (PoP) licence and start distributing NPS later.
“We will eventually get into distribution. That is the intent also. That’s going to help us both in terms of revenues and increasing assets for pension fund as well”, he said.
Asked if DSP Pensions was entering the pension fund management space a bit late in the day, Bhagat replied in the negative. “
“No we are entering this industry absolutely at the right time. Industry is growing very fast. There is still room to grow. Government employees are now allowed to choose private fund managers. So there is lot of scope for any fund manager to grow”, he said.
On how DSP Pensions plans to differentiate itself in the market, Bhagat said “We want to position ourselves in the market as someone different in how we manage assets. We want to stand out in fund performance.
That’s the only differentiator when there are eleven fund managers. Our focus would be giving better returns to our customers, given the boundaries of regulation”, he said.
DSP Pensions is starting its pension fund management journey with a capital of ₹ 60 crore (regulatory stipulation of minimum capital is ₹ 50 crore).
DSP Pensions is set to commence business at a time when the overall assets under management (AUM) of the NPS and Atal Pension Yojana combined together in the country crossed the ₹ 10 lakh crore mark.
“We are going to be very serious in how we strategise the market, build the market and create market for ourselves in the pensions fund management industry”, Bhagat added.
Prior to DSP Pensions coming on board, there were ten pension fund managers —seven (the pension fund management arms of SBI, UTI, LIC, ICICI, HDFC, Aditya Birla SunLife and Kotak) and three others ( Axis Asset Management, Tata Asset Management and Max Life Insurance —who had recently started business as pension fund managers.