India

March 26, 2007

The micro-pension initiative, launched by UTI Mutual Fund nearly year ago, is gathering steam. IFFCO and a host of urban cooperative banks (UCB) are in talks with the fund to invest in the UTI Retirement Benefit Pension Fund, said UK Sinha, CMD, UTI AMC .

The first to join the Sebi-approved pension plan were 50,000 members of Ahmedabad's Self-Employed Women’s Association (SEWA). Comfed, a federation of milk producers in Bihar , Paradip Port Trust, a self help group in Tamil Nadu followed suit. An urban cooperative bank in Maharashtra, run by women and for women is the latest entrant to the scheme.

Nearly 2,000 members of Mann Deshi Mahila Sahakari Bank (MDMSB) joined UTI MFs pension plan on March 23. Members in the age group of 18 to 55 years will contribute a minimum amount of Rs 200 every month. The scheme invests a minimum of 60% and a maximum of 100% in debt and these balance in equity. These women will be entitled to a pension after they cross 58 years. It promises to give a reasonable amount as pension, considering that the plan has traditionally given yearly returns of around 12%.

MDMSB and its parent organization Mann Vikas Samajik Sanstha have been giving loans between Rs 5,000 to Rs 7,000 to over 48,000 rural women. This has seen the creation of around 2,300 self help groups and also encouraged several marginalized women to start entrepreneurial projects.