Investment in National Pension Scheme: Issues and Trends

Abstract

Purpose: Retirement is a time to leave from the job or work forever. Investing for retirement plays an important role.  This study makes an effort to evaluate the various issues and trends of the investment in the National Pension Scheme (NPS) by an individual. Since the primary goal of this study was to assess the issues and trends of the investment in the National Pension Scheme for retirement benefits, and the study also evaluates its advantages, benefits, constraints, and disadvantages through ABCD analysis.

Design: This research is conducted through secondary sources in order to provide a full-fledged evidence-based study on the issues and trends in the investment on National Pension Scheme. The semi-systematic review is conducted using various published reports and articles from sources including Springer, Tailor & Francis, Emerald, Google Scholar, Srinivas Publication, Research Gate, SSRN, etc.

Findings: The result of compressive review revealed that in India, people save as a part from their income but very few invest for their retirement.  The reasons for not investing for retirement is classified under two major factors i.e., internal and external factors. NPS provides pension scheme as well as investment scheme which allows the member to choose their investment in different assets. Unfortunately, due to lack in financial literacy and financial knowledge on the investment of retirement products and plans.

Practical Implications: This research provide a guide for members who wish to invest for their retirement and create an awareness of the numerous challenges by the citizens by the policy makers and improved performance for the benefit of the citizen. It serves as a source of information for NPS users to comprehend the advantages of enrolling in pension plans for their retirement.  

Originality/value: This study as per the secondary data may provide overall view on the National Pension Scheme and may help the customers for better understanding about the pension scheme and also assist the policy makers and pension regulator to promote investment on the retirement plans; but the concept of NPS can be better understood through primary survey, therefore it is the limitation of the study.

Paper type: Case Study.