Regulation and ethics
In this chapter: PFRDA framework · Conduct and grievance redressal
PFRDA (Pension Fund Regulatory and Development Authority) regulates NPS and APY. NPS intermediaries — PoPs, retirement advisers, aggregators — must follow PFRDA conduct norms. Ethics: act in subscriber interest, no churning, full disclosure of charges and choices, grievance redressal via CRAs (Central Recordkeeping Agencies) and PFRDA portal.
PFRDA structure: regulates NPS and APY; oversees CRAs (KFin Tech, Protean), PFMs (pension fund managers), PoPs, annuity providers. Charges: subscriber registration, contribution upload, AUM-based, switch charges — disclosed in subscriber agreement. Common ethical issues: aggressive sales of higher-cost choices, churning between PFMs for trail commissions, recommending wrong asset allocation for the subscriber's age. PFRDA inspections, similar to SEBI for MF distributors, check compliance. Subscribers can file grievances on the CRA portal or PFRDA website.
A regulatory evolution to track: PFRDA-IRDAI-SEBI convergence on retirement-product oversight. Mis-selling of retirement-themed products (NPS, ULIP, pension annuities) increasingly attracts joint regulatory attention. RIAs and retirement advisers must be careful about cross-product mis-selling — recommending a ULIP "for retirement" without disclosing the lower yield vs alternatives is now a multi-regulator violation. The exam tests these scenarios with regulatory-overlap angles.