Influence of Socio Demographic Factors on NPS Subscription – Enrollment based analysis

Abstract

India is currently enjoying high demographic dividend advantages. Existing young workforce in India may turn in to a major socioeconim problem once they reach retirment age if they have not planned and saved enogh for their nest egg ages. Understanding early enrollment trends to dedicated pension and retirment products will help policy makers to take currective actions wherever necessary.

More than 80% of the workers in India are employed in Private sector or informal sector. Increasing mobility because of the workplace and changed nuclear family structures are creating problems to old age people and they may not be able to rely on next generation any more. Life expectancy, health care costs and inflation are increasing very rapidly in India. Informal sector workers who are not covered under pension plans may have to consider voluntary pension schemes seriously to keep them out from any major financial distress in their old ages.

National Pension System popularly known as NPS was launched in India by the Government to increase pension coverage, particularly to the informal sector. Initially NPS was introduced to government employees and later it was extended to corporates and to all citizens of India including informal sector employees. India’s vast informal sector needs a social security and an ambitious NPS was introduced to provide voluntary contributory pensions to all citizens on India.

NPS All citizen mode is relativly new defined contribution product introduced by governement to attract and encourage saving for pension. As of now enrollement to NPS All citizen mode is not very appealing but showing a study growth. This study is aimed at understanding and analysing impacts of socio demographic parameters on NPS enrollment.

Last 5 years NPS All Citizens model subscriptions data from NPS trust will be used for the current study. Sociodemographic factors like Gender, Age group, Educational Qualification, Occupation, Income range and Location will be considerd for this study. Descriptive statistics will be used for analysing and interpriting data. Study will focus on establishing association among paramaters and to identify strenght of the relationship.

Study outcomes will help us to understand NPS enorolment trends and patterns. Descriptive study will help us to understand the data distribution in a better way and we can take necessary strategic decision wherever necessary. Policy makers can compare this with some established benchmarks that in turn will help them to take some informed decision and can change the policies to encourage the enrollments